Which statement best characterizes microeconomics?

Microeconomics is fundamentally concerned with the behavior and decision-making processes of individual economic units, which include consumers, households, and firms. By focusing on these smaller entities, microeconomics investigates how they allocate resources, make purchasing decisions, and respond to changes in price or market conditions. This focus allows for a detailed understanding of supply and demand dynamics, pricing strategies, and the way market structures impact individual businesses and consumers.

The other statements do not properly reflect the nature of microeconomics. For instance, while government spending might influence economic conditions, it falls more under the realm of macroeconomics, which examines the economy as a whole. Similarly, analyzing the global economy involves macroeconomic principles rather than microeconomic ones, which center on individual actors. Lastly, the assertion that microeconomics ignores individual consumer choices is inaccurate, as understanding these choices is actually a core component of microeconomic study.