Question $38(1\mathrm{.}25$ points$)$

Which of the following statements about the Fed is true?

The Fed conducts both monetary and fiscal policy in the U$.$S$.$

The Fed conducts fiscal policy, but not monetary policy in the U$.$S$.$

The Fed conducts monetary, but not fiscal policy in the U$.$S$.$

The Fed conducts neither monetary nor fiscal policy in the U$.$S$.$

Question $39(1\mathrm{.}25$ points$)$

When the Fed increases the interest on reserve balances, the federal funds rate

increases

decreases

not enough information