Final answer:
Cognitive-social theory, proposed by Albert Bandura, is the personality theory that concentrates on learning by observation and includes cognitive processes as factors influencing individual differences.
Step-by-step explanation:
The personality theory that focuses on learning by observation, as well as the role of cognitive processes that lead to individual differences, is known as d) Cognitive-social theory.
Social-cognitive theory, as proposed by Albert Bandura, emphasizes the interplay between cognitive processes, behavior, and the environment, also referred to as reciprocal determinism. It accounts for learning via observation and incorporates cognition as a crucial component besides learning.
This approach differs from behaviorist theories which mainly consider observable behavior and psychodynamic theories focusing on inner psychological processes. Cognitive-social theory regards thinking and reasoning as important components of learning and personality development and does not solely depend on the idea that personality is shaped by early life experiences. Instead, it postulates that one's personality develops throughout the lifespan as a result of continuous interaction with the environment, personal thoughts, and behaviors.