1. In the spreadsheet below, create a Data Table in which th

1. In the spreadsheet below, create a Data Table in which the duration is computed as afunction of the coupon rate (coupon = 0%, 1%, … , 11%). Comment on the relationbetween the coupon rate and the duration.ABC1CHANGING THE COUPON RATEEffect on Duration2Current date21-May-073Maturity, in years214Maturity date21-May-275YTM15%6Coupon4%7Face value1,00089Duration9.03982<– =DURATION(B2,B4,B6,B5,1)What is the effect on a bond’s duration of increasing the bond’s maturity? As in the previ-ous example, use a numerical example and plot the answer. Note that as N → ∞, the bondbecomes a consol (a bond that has no repayment of principal but an infinite stream ofcoupon payments). The duration of a consol is given by (1 + YTM) / YTM. Show that yournumerical answers converge to this formula.“Duration can be viewed as a proxy for the riskiness of a bond. All other things beingequal, the riskier of two bonds should have lower duration.” Check this claim with anexample. What is its economic logic? Replicate the two graphs in section 20.5.