Which of the following is an assumption of rationality?
A) The problem is ambiguous.
B) Multiple goals are to be achieved.
C) Time and cost constraints are known.
D) Preferences change quickly.
E) All alternatives and consequences are known.

Question

Quizplus · Accepted Answer

Rationality assumes that decision-makers have perfect information and know all available alternatives and their consequences. Therefore, option E is the assumption of rationality. Option A indicates a lack of clarity, which does not align with rationality. Option B implies the existence of trade-offs, which rationality assumes as a given. Option C deals with the availability of resources, which does not necessarily relate to rationality. Option D suggests constant changes in statements or preferences, whereas rationality posits consistency.

Which of the Following Is an Assumption of Rationality