Step $3$: Check each option

a$.$ If Stock A has a lower dividend yield than Stock B$,$ then its expected capital gains yield must be higher than Stock B$\text{'}$s$.$

$$ Correct $$ this balances the equation, since rA $>$ rB$.$

b$.$ Stock B must have a higher dividend yield than Stock A$.$

$$ Not always true; depends on growth rates too.

c$.$ Stock A must have a higher dividend yield than Stock B$.$

$$ Not necessarily; could be higher growth instead.

d$.$ Stock A must have both a higher dividend yield and a higher capital gains yield than Stock B$.$

$$ Too strong; only one needs to be higher.

e$.$ If Stock A has a higher dividend yield than Stock B$,$ then its expected capital gains yield must be lower than Stock B$$s$.$

$$ Not necessarily; both could be higher.