"Go on" often means to continue or to proceed. "The meeting went on for two hours." "I've talked enough about it already, I won't go on." "The team lost its first match, but went on to win three in a row." When the two words are used alone in a command like this, it is just a way of encouraging somebody to do some action. Depending on the context and the tone of voice, it can be a friendly way of giving permission or making a suggestion, or it can be an angry command. :-) "Go on, have a biscuit!" (= "You are allowed to eat a biscuit", "Please eat one of these biscuits.") >:-O "Go on, get me a biscuit!" (= "I'm hungry, damnit, get me a biscuit!")

In this instance, "go on" is a way of telling you to do something. More specifically, "go on" in this instance means what you are being told to do, to "have a biscuit", is okay and acceptable by the speaker. Let me know if this helps. Peace.