Utilitarianism tries to overcome the problems of using egoism as a moral guide by making the basis for decision making what will produce the greatest amount of pleasure for the greatest amount of people. This is obviously in contrast to egoism, which would take the basis for decision making as that which would serve one's own interest and provide for one's pleasure.
The differences between rule and act utilitarianism are as follows: the act utilitarian only considers the results or consequences of a single action whereas the rule utilitarian considers the consequences that result of following a rule of conduct.
Let's take a simple example to make this clearer. You are sitting in an exam, and you realise that you have revised the wrong questions. HELP! But, then you realise that you have left your revision notes in your pocket, so you have the choice of sneaking them out and cheating in your exam.
If you ascribed to Act Utilitarianism, you would look at the consequences of that single action. You would say that cheating would produce the most happiness for you and for your family, as you would get a good grade which would allow you to go to a good college and get a good job etc. By calculating the outcome of this single action, you would think it was worthwhile. So you would cheat!
If you ascribed to Rule Utilitarianism, you would need to consider what the long term consequences would be if everyone cheated in their exams. You would think that if everyone cheated, you would have doctors, lawyers, teachers who weren't able to do their jobs properly, resulting in chaos and a break down in trust in society, as people wouldn't trust that their doctors knew how to heal them. So by calculating the eventual outcome, you would decide that there would be far more harm in cheating in the long run, and you would fail your exam.
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