In a market where a company is trying to determine its production level, if the marginal cost of producing an additional unit is lower than the price it can sell that unit for, what should the company do to maximize profit?

When a company finds that the marginal cost of producing one more unit is lower than the selling price, it means that making that extra unit will increase profit. This is because the company will earn more from selling the unit than it costs to make it. For example, if it costs $5 to produce a toy but the company can sell it for $10, producing that toy adds $5 to the profit. To maximize profit, the company should continue to produce additional units as long as the selling price remains higher than the marginal cost. Eventually, they will reach a point where producing more units will no longer be profitable, so they should keep an eye on costs and prices.