Railroads Online Play - How do you use the marker lights on a Caboose correctly?

I'm BearJangles, and I am on a mission to learn about railroads, railroading, model railroading.. etc.! Help me face my ignorance as I play some Railroads Online.

I apologize in advance for the fan noise in the background. I'll be sure to turn that fan off next time I record \p/