Microeconomics is a branch of economics that focuses on the behavior of individual consumers and firms. It studies how these entities make decisions regarding the allocation of resources, production, and consumption of goods and services. Key concepts include supply and demand, price elasticity, and market structures. Microeconomics also examines how various factors, such as income, preferences, and competition, influence choices and market outcomes. By analyzing these elements, microeconomics helps explain how prices are determined and how resources are distributed in an economy, ultimately impacting overall economic efficiency and welfare.