According to the bounded rationality hypothesis, an individual confronting a large number of complicated choices is most likely to respond by
A) using a simple rule of thumb to choose among a subset of easiest-to-evaluate options.
B) using the ceteris paribus assumption to assist in simplifying and examining each of the possible options.
C) utilizing readily available empirical evidence to assist in evaluating every option.
D) assessing every available choice by developing sophisticated theories regarding each option.

Question

Quizplus · Accepted Answer

According to the bounded rationality hypothesis, individuals faced with a large number of complicated choices are likely to use simplified decision-making strategies, such as heuristics or rules of thumb, to choose among a subset of the easiest-to-evaluate options. Option A accurately reflects this concept. Option B, utilizing the ceteris paribus assumption, may assist in simplifying options but does not necessarily account for a large number of complicated choices. Similarly, option C, utilizing readily available empirical evidence, may not be feasible when faced with a large number of complicated choices. Option D, assessing every available choice by developing sophisticated theories, is unlikely given the limited cognitive resources available to individuals.

According to the Bounded Rationality Hypothesis, an Individual Confronting a Large