Suppose That the Pretax Holding-Period Returns on Two Stocks Are

Suppose that the pretax holding-period returns on two stocks are the same. Stock A has a high dividend payout policy and stock B has a low dividend payout policy. If you are a high-tax rate individual and do not intend to sell the stocks during the holding period, ________.

A) stock A will have a higher after-tax holding-period return than stock B
B) the after-tax holding period returns on stocks A and B will be the same
C) stock B will have a higher after-tax holding-period return than stock A
D) The answer cannot be determined from the information given.