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The term 'morpheme' is defined as the smallest meaningful unit of language. This is significant because morphemes can be individual words or parts of words (such as prefixes, suffixes, or roots) that carry meaning. For instance, the word "cats" consists of two morphemes: "cat," which conveys the animal, and "s," which indicates plurality. Understanding morphemes is crucial for language acquisition and literacy, as they contribute to word formation and meaning-making in communication.

In linguistic terms, recognizing morphemes allows for a better grasp of how words are constructed and understood, making it essential for analyzing language structure. The other options do not accurately capture this definition; whereas a compound word involves multiple morphemes, an inflectional unit specifically refers to changes in form to express different grammatical features, and a combination of clauses pertains to syntactic structure rather than meaning units. Therefore, the focus on meaning emphasized in the correct choice is what solidly defines a morpheme.

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