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.
3. Identify the direction of change in modified duration if:
   1. The coupon of the bond were 2%, not 3%.
   2. The maturity of the bond were 7 years, not 30 years.