Valid reasons for firm to reduce or eliminate these dividend

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Reference no: EM13941882

Quick Mart has been paying a quarterly dividend of $1.20 a share. Which of the following are valid reasons for the firm to reduce or eliminate these dividends?

I. The firm is on the verge of violating a bond restriction.

II. The firm wants to save cash for an acquisition with a 40 percent premium.

III. The firm can raise new capital easily at a very low cost.

IV. Congress just changed the tax laws eliminating all taxes on capital gains.

Reference no: EM13941882

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