We first calculate the present value of cash flows as follows,

P = 80/1.06^1 + 80/1.06^2 + 1080/1.06^3 = 1,053.46

Convexity is given by:

Convexity = Σ (t_i^2 × [PV(C_t) / Σ PV(C_t)]) = [80/1.06^1 / 1,053.46] × 1^2 + [80/1.06^2 / 1,053.46] × 2^2 + [1080/1.06^3 / 1,053.46] × 3^2 = 8.0889

Modified Convexity = Convexity / (1 + y/m)^2

And thus, the modified convexity is given by:

Modified Convexity = 8.0889 / 1.06^2 = 7.1991