The following are the expected price appreciation and dividend yield components of returns on two portfolios—a high dividend yield portfolio and a low dividend yield portfolio.

You are a taxable investor who faces a tax rate of 40% on dividends.
What would your tax rate on capital gains need to be for you to be indifferent between these two portfolios?

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Portfolio Expected Price Appreciation Expected Dividend Yield High yield 9% Low yield 12% 5% 1%