 In  Lehmann and Magidor (1992)  a Rational Closure for conditional knowledge bases such as \(\mathbf{K}\) is proposed that yields the desired consequences. We omit the technical details. The basic idea is to assign natural numbers, i.e., ranks, to formulas which indicate how exceptional they are relative to the given knowledge base \(\mathbf{K}\). Then the ranks of formulas are minimized which means that each formula is interpreted as normally as possible. A conditional assertion \(\phi \nc \psi\) is in the Rational Closure of \(\mathbf{K}\) if the rank of \(\phi \wedge \psi\) is strictly less than the rank of \(\phi \wedge \neg \psi\) (or \(\phi\) has no rank). The rank of a formula \(\alpha\) is calculated iteratively. Let \(m(\mathbf{K}') = \{ \phi \supset \psi \mid \phi \nc \psi \in \mathbf{K}'\}\) denote the material counterpart of a given set of conditional assertions \(\mathbf{K}'\). Let \(\mathbf{K}_0 = \mathbf{K}\). \(\alpha\) has rank 0 if it is consistent with \(m(\mathbf{K}_0)\). Let \(\mathbf{K}_{i+1}\) be the set of all members \(\phi \nc \psi\) of \(\mathbf{K}_i\) for which the rank of \(\phi\) is not less or equal to \(i\). \(\alpha\) has rank \(i+1\) if it doesn’t have a rank smaller or equal to \(i\) and it is consistent with \(m(\mathbf{K}_{i+1})\). 