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The “substantial evidence” standard, applied to many agency factual determinations, requires that agency decisions be supported by evidence that a reasonable person might accept as adequate to support a conclusion. This standard provides meaningful review while acknowledging that agencies may reasonably reach different conclusions from the same evidence.
The “arbitrary and capricious” standard, applied to agency policy decisions, asks whether the agency examined relevant data, articulated a rational connection between facts and choices, and considered important aspects of the problem. This standard allows agencies considerable discretion while requiring that their decisions be reasoned and well-supported.
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