Question: Hello could you help me with this homework exercise please? 3. Assume there exist a riskless asset with gross return R and a risky asset

Hello could you help me with this homework exercise please?

3. Assume there exist a riskless asset with gross return R and a risky asset with gross return R'. Derive the risk premium, E[R ]-R, in a stochastic discount factor model (a.k.a. consumption-based asset pricing) and discuss what your result implies of the risk premium of a counter-cyclical risky-asset. (5 pts)

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