Consider how the Federal Reserve Board sets interest rates. The Fed examines the relevant economic data and makes a judgment about the present and future state of the economy. If economic activity seems to be slowing down, the Fed might decide to lower interest rates as a means for stimulating economic growth. If the economy seems to be growing too fast and the inflation rate is increasing, they might choose to raise interest rates. Lowering or raising interest rates, in and of itself, is neither good nor bad; the rightness of the act depends on the consequences. This action is consistent with the ________.

Question

Quizplus · Accepted Answer

The utilitarian principle focuses on the consequences of actions, aiming to maximize overall happiness or utility. The Fed's decision to adjust interest rates based on economic conditions and their potential outcomes aligns with this principle.

Consider How the Federal Reserve Board Sets Interest Rates