Unilever has issued bonds that pay annually with the following characteristics:

Coupon	Yield to Maturity	Maturity	Macaulay Duration
3%	3%	30 years	27.92 years

1. Calculate modified duration using the information above.
2. Explain why modified duration is a better measure than maturity when calculating the bond's sensitivity to changes in interest rates.
4. Identify the direction of change in modified duration if:
   1. 1. Thecouponofthebondwere2%,not3%.
   2. 2. Thematurityofthebondwere7years,not15years
   3. 3. thecouponofthebondwere2%,not3%.