Can you run Microsoft applications on Linux?

Yes and no. Linux will not run Windows applications by itself, however, there are ample tools written for Linux that permit you to run Windows applications on Linux. The open-source WINE software will run a majority of Windows software on Linux. You can even configure Linux to automatically recognize Windows applications and use WINE to run them. Alternatively, there's a wide variety of virtual machine products that permit you to run the Windows operating system as an application under Linux, and, in turn, any Windows applications inside the Windows virtual environment. Finally, some "Windows applications" are written in .Net or Java and can be run directly under Linux using mono and java respectively (albeit, some .Net applications will not yet run under mono).