Which of the following statements accurately describe the implications of marginal costs in production decisions? Select all that apply.

Marginal costs refer to the additional cost incurred when producing one more unit of a good or service. Understanding these costs is crucial for businesses because they help in making production decisions. For example, if a company finds that the marginal cost of producing an extra toy is lower than the price they can sell it for, it makes sense to produce that extra toy to increase profit. On the other hand, if the marginal cost exceeds the selling price, the company should not produce more, as it would lead to a loss. Therefore, analyzing marginal costs helps businesses determine the most efficient level of production to maximize profits.