To Have Adequate Protection to Cover a Depreciation, the Central

Multiple Choice

To have adequate protection to cover a depreciation, the central bank must keep its foreign currency reserves at the level at which:

A) they are growing at the same rate as GDP.
B) they are equal to the demand for money minus the amount of domestic credit (held by the central bank) .
C) they are greater than zero.
D) they are worth three months of import protection.