Anchoring bias is a cognitive bias that occurs when individuals rely too heavily on the first piece of information they encounter when making decisions. This initial information, known as the "anchor," can significantly influence subsequent judgments and choices, even if it is irrelevant or misleading. For example, if a person sees a car priced at $30,000, they may perceive a $25,000 car as a good deal, even if the actual market value is much lower. This bias can affect various aspects of decision-making, including negotiations, pricing, and assessments of value. In many cases, people may fail to adjust their opinions adequately after receiving new information, leading to skewed perceptions. Understanding anchoring bias can help individuals make more informed and rational decisions by encouraging them to consider a wider range of information before concluding.