1. Fortune Success Limited has an issue of preferred stock with a $0.50 stated dividend that just sold for $9.20 per share. What is the bank's cost of preferred stock? A. 4.60% B. 4.64% C. 5.39% D. 5.43% 2. The intercept point of the security market line (SML) is the rate of return which corresponds to: A. the risk-free rate. B. the market rate. C. a return of zero. D. the market risk premium. 3. Which one of the following indicates a portfolio is being effectively diversified? A. An increase in the portfolio beta. B. An increase in the portfolio rate of return. C. An increase in the portfolio standard deviation. D. A decrease in the portfolio standard deviation