Assume a firm utilizes the security market line approach to determine the cost of equity. If the firm currently pays an annual dividend of $2.40 per share and has a beta of 1.42, all else constant, which of the following actions will decrease the firms cost of equity?

a) a decrease in the risk free rate

b) a decrease in the dividend amount

c) an invrease in the market rate of return

d) a decrease in the firms beta

e) an increase in the dividend amount