The Federal Reserve conducts

A) only monetary policy.
B) only fiscal policy.
C) both monetary and fiscal policy.
D) neither monetary nor fiscal policy.

The Federal Reserve is responsible for monetary policy, which involves setting interest rates and influencing the money supply to achieve the dual mandate of price stability and maximum employment. Fiscal policy, on the other hand, involves government spending and taxation decisions, which are made by Congress and the executive branch of government. The Federal Reserve does not have direct control over fiscal policy.