This is part of a series dealing with the formation of benzene from acetylene on iron clusters, Fe-n(q+) (n=1-4, q=0,1). In this paper, we show that the formation of benzene from acetylene on Fe and Fe-n(+) (n=1-4) is favorable from a thermodynamic point of view. We explain the variation of the rate constants observed for the successive adsorption of acetylene molecules on an iron cation and the experimental observations about the cyclodimerization of acetylene molecules in Fe(C2H2)(2)(+) by referring to the spin conservation principle. Our results indicate that the complexes resulting from the cyclodimerization of Fe-n(C2H2)(2)(+)/Fe(C2H2)(2) and Fe-n(C2H2)(3)(+)/Fe(C2H2)(3)(n=1-4) contain an n-C4H4 ligand (formation of a metallacycle) rather than a cyclobutadiene molecule. However, it is possible to observe the formation of cyclobutadiene from Fe(C2H2)(2)(+) and Fe-2(C2H2)(3)(+) only if spin-orbit coupling is significant. A post-self-consistent-field method that includes a multideterminantal treatment is needed to get a quantitative energetic description of the various steps of the reaction. Finally, we discuss various difficulties met in this study and possible ways to deal with them. (C) 2003 American Institute of Physics.