If we check up on the proportions of this diagram, we obtain the following result: there is neither commodity production nor exchange, but in truth a social division of labour. The products of Department I are assigned to the workers of Department II in the requisite quantities, and the products of Department II are apportioned to everyone, worker or no, in both departments, and also to the reserve-fund; all this being the outcome not of an exchange of equivalents but of a social organisation that plans and directs the process as a whole--because existing demands must be satisfied and production knows no other end but to satisfy the demands of society. Yet all that does not detract from the validity of the equations. The product of Department I must equal I_c_ + II_c_: this means simply that Department I must annually renew all the means of production which society has used up during one year's labour. The product of Department II must equal the sum of I(_v + s_) + II(_v + s_): this means that society must each year produce as many consumer goods as are required by all its members, whether they work or not, plus a quota for the reserve fund. The proportions of the diagram are as natural and as inevitable for a planned economy as they are for a capitalist economy based upon anarchy and the exchange of commodities. This proves the diagram to have objective social validity, even if, just because it concerns _simple_ reproduction, it has hardly more than theoretical interest for either a capitalist or a planned economy, finding practical application only in the rarest of cases.