In the context of marginal analysis, how should a firm decide whether to increase production of a good when the marginal benefit exceeds the marginal cost?

In marginal analysis, a firm should consider increasing production when the marginal benefit, or the additional value gained from producing one more unit, is greater than the marginal cost, which is the additional cost incurred to produce that unit. This means that by producing more, the firm can earn more money than it spends, leading to increased profits. For example, if a company makes shoes and finds that making one more pair costs $30 but it can sell that pair for $50, the marginal benefit of $50 exceeds the marginal cost of $30. Therefore, producing that extra pair is a smart decision because it adds $20 to the firm's profit. In essence, as long as the extra benefit surpasses the extra cost, the firm should continue to increase production to maximize its overall profit.