Question

When the risk that some banks might fail​ increases, depositors may not have enough information to determine whether their bank is a good one or one of the banks at greater risk to fail. Depositors have an incentive to withdraw their deposits before the bank runs out of funds. If this becomes a widespread​ occurrence, it is known​ as:

Answer 1

bank panic

Step-by-step explanation:

Based on the information provided within the question it can be said that if this becomes a widespread occurrence, it is known as a bank panic. This term refers to a financial crisis that occurs when all the customers of a bank try to withdraw their money from the bank. This causes the bank to go out of business which leads to people panicking.