Final answer:
The rational choice paradigm traditionally assumes unlimited information-processing capabilities, which is contradicted by real-world observations of human decision-making that often displays limitations and irrationalities. The correct option is B.
Step-by-step explanation:
The statement that the rational choice paradigm assumes decision makers have limited information-processing capabilities and engage in a limited search for alternatives is False.
The traditional economic models of rational behavior actually assume that people have unlimited information-processing capabilities and consider all available information to make consistent, informed decisions that maximize their utility. In reality, however, human behavior often deviates from these models, showing that people can make seemingly irrational decisions that do not always align with their best interest.
Anthony Downs' work and B. F. Skinner's novel highlight the impracticalities of the rational choice paradigm by focusing on the lack of incentive for individuals to invest in political information, since the impact of a single vote is insignificant in a large election. These instances from economics and psychology demonstrate that human decisions are not always based on a meticulous and exhaustive evaluation of available information, as assumed in rational choice theory.