**Core Concept**
Tinea faciei is a superficial fungal infection affecting the face, primarily caused by dermatophytes such as Trichophyton and Microsporum species. The diagnosis involves identifying the causative organism and ruling out other dermatological conditions.

**Why the Correct Answer is Right**
KOH (Potassium Hydroxide) preparation is a primary diagnostic tool for Tinea faciei. The KOH solution dissolves keratin and other cellular components, allowing for microscopic examination of fungal elements such as hyphae and spores. This method is particularly useful for detecting dermatophytes, which are the primary cause of Tinea faciei. The presence of fungal elements in the KOH preparation confirms the diagnosis.

**Why Each Wrong Option is Incorrect**
**Option A:** Wood's lamp examination is used to diagnose conditions like vitiligo, albinism, and certain bacterial and fungal infections, but it is not a primary diagnostic tool for Tinea faciei.
**Option B:** Gram staining is used to identify bacterial infections, not fungal infections like Tinea faciei.
**Option C:** Biopsy is an invasive procedure that may be used in cases where the diagnosis is unclear, but it is not a first-line diagnostic tool for Tinea faciei.

**Clinical Pearl / High-Yield Fact**
When performing a KOH preparation, it's essential to heat the slide to dissolve keratin and other cellular components, making it easier to identify fungal elements.

**Correct Answer: C. Biopsy.**