what are the implications of selling a product at a price less than its marginal cost?

Answer 1

This can happen when a company has a contract to deliver goods at a set price over time and then experiences a big increase in the cost of it's inputs and the contract doesn't allow for price changes. Lots of government contract are written as fixed price for delivery so this actually can occur and the company just gets stuck with the loss.

Dumping and other things are also relevant.

One last implication is that the company could have a workforce that is actually cheaper to keep working than to lay-off, fire, or retire. Pension/retirement cost for these workers may be so high that it doesn't make sense to have them get laid off. It's not just that you eliminate the labor cost per unit, it's the overall cost to the company that they may be calculating. So it's more of a change in cost calculation than a total cost calculation. Not a common occurrence but it does happen.

Answer 2

You are crazy, dumping products produced in error, or engaging in unfair/illegal business practices to drive competitors out of your market.