Combinational circuits are digital logic circuits whose outputs depend only on the current inputs. They include half adders, full adders, decoders, encoders, and multiplexers. A half adder performs addition of two bits and produces sum and carry outputs. A full adder can add three bits by including the previous bit's carry. Combinational circuits can be represented through truth tables, Boolean equations, or schematic diagrams. Subtraction circuits like half and full subtractors also exist to perform subtraction operations.