Explain Why It Is That in an Efficient Market,investments Have

question 64

Essay

Explain why it is that in an efficient market,investments have an expected NPV of zero.

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Definitions:

Unearned Revenue

Money received by a company for goods or services that have yet to be provided to the customer.

Accrued Wages

Salaries or wages that have been earned by employees but have not yet been paid by the company.

Net Income

What a company ultimately earns in profit once expenses and taxes are removed from its total income.

Adjusting Entries

Journal entries made in the accounting records to correct or update financial information before the preparation of financial statements.