Questions #15-16 are based on the following situation: Suppose you buy a five-year zero-coupon bond with semi-annual discounting and a 5% YTM. The face amount is $1,000. 12 pts) 15. What is the current price of this bond? Assuming no change in its YTM, the bond's price will steadily accrete over time, reaching $1,000 at maturity. The U.S. Internal Revenue Service views this accretion as an effective accumulation of interest. Unfortunately for you, the IRS requires you to pay tax on this imputed or phantom income, even though you don't actually receive any interest