Obviously, what is taken as "rational" is of chief importance here. Usually, "rational" is defined in a formal, mathematical way, along the lines of Game theory; this often means making a choice is taken to be equivalent to solving a mathematical optimization problem.

Often, to simplify calculation and ease prediction, some rather unrealistic assumptions are made about the world. These can include:

- An individual has precise information about exactly what will occur under any choice made. (Alternatively, an individual has a reliable probability distribution describing what will happen under any choice made.)
- An individual has time and ability to weigh every choice against every other choice
- An individual is fully aware of all possible choices

- They see people as "rational" beings, and thus believe that a model in which they are represented as such should be reasonably accurate
- Assumptions of rationality have useful formal properties

See also:

- Homo economicus
- Rational expectations
- Neoclassical economics
- Organizational theory