EFFICIENT MARKET THEORY Definition

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EFFICIENT MARKET THEORY is the hypothesis that market prices reflect the knowledge and expectations of all investors. Within this theory, investors who adhere to it believe it to be highly improbable that market movement can be predicted, i.e., using darts to chose stocks are just as effective as stock or market analysis.

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DIRECT WRITE-OFF METHOD is a method of accounting for bad debts that records the loss from an uncollectible account receivable at the time it is determined to be uncollectible; no attempt is made to estimate uncollectible accounts or bad debt expense.

SALES TURNOVER is the total amount sold within a stipulated time period, usually 12 months. Sales turnover is usually expressed in monetary terms but can also be in total units of stock or products sold.

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