Bounded rationality is a concept in decision-making that suggests individuals are limited in their ability to process information and make optimal choices. This limitation arises from constraints such as cognitive capacity, time, and available information. As a result, people often rely on heuristics or simplified rules of thumb to make decisions rather than evaluating every possible option. The term was introduced by the economist Herbert Simon, who argued that while individuals strive to make rational choices, they often settle for satisfactory solutions instead of the best ones. This approach acknowledges the complexities of real-world decision-making, where perfect information and unlimited cognitive resources are rarely available.