Explain the ReAct Agent Loop

Explain the ReAct architecture for a tool-using agent. Describe how reasoning, actions, and observations interact and how the loop decides to continue or finish. ### Constraints & Assumptions Use a generic tool-enabled application with defined tool schemas. Focus on observable state transitions and decision quality; an action must be grounded in available tools and its result must be treated as an observation, not proof that the overall task succeeded. ### Clarifying Questions Which tools are available? What state persists across iterations? How are failures, time budgets, and completion checked? Which actions require external authorization? ### What a Strong Answer Covers The iterative decision/action/observation loop, tool argument validation, updated context, stopping criteria, and common failure modes. ### Follow-up Questions What prevents repeated ineffective tool calls? How should an agent handle an ambiguous tool result? When is a fixed workflow more reliable than an open-ended loop?