How was the term magical realism first used?

It was used for the German art critic Franz Roh in 1925.

The emergence of the literary current called magical realism took place at the beginning of the 20th century. Also known by the names fantastic realism or wonderful realism (Spain), it is considered a characteristic of Latin American literature.

The main particularity of this literary current is to merge the magical universe with reality, showing unreal or strange elements as something usual and commonplace. In addition to this characteristic, magical realism presents the magic elements in an intuitive way (without explanation).

i think your answer there is c