C is the answer.
https://learn.microsoft.com/en-us/mem/intune/protect/conditional-access-intune-common-ways-use#device-based-conditional-access
With Intune, you deploy device compliance policies to determine if a device meets your expected configuration and security requirements. The compliance policy evaluation determines the devices compliance status, which is reported to both Intune and Azure AD. It's in Azure AD that Conditional Access policies can use a device's compliance status to make decisions on whether to allow or block access to your organization's resources from that device.
This is the correct link but if you read it further it states:
When you use Conditional Access, you can configure your Conditional Access policies to use the results of your device compliance policies to determine which devices can access your organizational resources. This access control is in addition to and separate from the actions for noncompliance that you include in your device compliance policies
So answer C is correct in this case
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