Your firmfollows a strict residual dividend policy. All else equal, which of the following factors would be most likely to lead to anincreaseinyour

Your firm follows a strict residual dividend policy. All else equal, which of the following factors would be most likely to lead to an increasein your firm's dividend per share?

• The company reduces the percentage of debt in its target capital structure.
• The number of profitable potential projects increases.
• Congress lowers the tax rate on capital gains.
• Earnings are unchanged, but the firm buys back shares of common stock.
• The firm's net income decreases.