Lort's Theory is a concept in the field of psychology that explores how individuals perceive and interpret their experiences. It suggests that people's understanding of events is influenced by their prior knowledge, beliefs, and emotions. This theory emphasizes the subjective nature of perception, highlighting that two people can interpret the same situation differently based on their unique backgrounds. The theory also addresses the role of cognitive biases in shaping perceptions. These biases can lead to distorted interpretations, affecting decision-making and behavior. By recognizing these influences, individuals can work towards a more objective understanding of their experiences and improve their interactions with others.