179Change tolow-dividend-payout policy in world of taxes.

Scott currently owns700shares of TwelveColonies, Inc. Twelve Colonies has ahigh-dividend-payout policy, and this year will pay a $2.20cash dividend on itsshares, which are selling currently at $25.00.

Assume Scott pays15% tax on dividend distribution and15% on capital gains. Also assume Scott originally paid $25.00for these shares. If Scott wants to receive only $150aftertax, is his wealth affected by changing this dividend policy from ahigh-dividend-payout policy to alow-dividend-payout policy?