Microeconomics is the branch of economics that studies individual agents, such as households and firms, and their decision-making processes. It focuses on how these entities interact in markets to allocate resources efficiently. Key concepts include supply and demand, price elasticity, and consumer behavior, which help explain how prices are determined and how goods and services are distributed. In microeconomics, the behavior of consumers and producers is analyzed to understand how they respond to changes in prices and income. This field also examines market structures, such as perfect competition, monopoly, and oligopoly, to assess how different environments affect economic outcomes and efficiency.