Bonds in a Nutshell

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All bonds are priced similarly. As an example, I will use US sovereign bonds, issued by Department of the Treasure.

(1) An idiosyncrasy of US treasurys is the are sold "by single-price auctions held weekly."
(a) Auction Frequently Asked Questions. TreasuryDirect, US Department of the Treasury, July 13, 2015
https://www.treasurydirect.gov/i ... es_auctions_faq.htm
("Treasury bills, notes, bonds, FRNs, and Treasury Inflation-Protected Securities (TIPS) are sold at single-price auctions. In a single-price auction, all successful competitive bidders and all noncompetitive bidders are awarded securities at the price equivalent to the highest rate, yield, or discount margin of accepted competitive tenders")

What does that mean?
(b) Dutch Auction. Investopedia, undated
www.investopedia.com/terms/d/dutchauction.asp
("The US Treasury (and other countries) uses a Dutch auction to sell securities. * * * When Google launched its public offering, it relied on a Dutch auction to earn a fair price")

(2)
(a) Despite the auctions, treasurys are sold near the par value (face value) -- but "usually issued at a discount. The discount is the amount the security is lowered from its face value and is considered the earned interest when the security matures. * * * The interest rate is determined at the time of auction [Department of Treasury will tell investors in advance, who then decide how much to bid]."
Learn More About Security Types. TreasuryDirect, Sept 24, 2013.
https://www.treasurydirect.gov/i ... cTypesLearnMore.htm
(b) Here is an  example

United States Treasury security
https://en.wikipedia.org/wiki/United_States_Treasury_security
("In the basic transaction, one buys a $1,000 T-Note for $950, collects interest of 3% per year over 10 years, which comes to $30 yearly, and at the end of the 10 years cashes it in for $1000. So, $950 over the course of 10 years becomes $1300")

Again, "$950" and "3%" are hypothetical, vary in different bids.

(3) bond (finance)
https://en.wikipedia.org/wiki/Bond_(finance)
(section 2.6 Market price: "The market price of the bond will vary over its life: it may trade at a premium (above par, usually because market interest rates have fallen since issue), or at a discount (price below par, if market rates have risen or there is a high probability of default on the bond)")

A bond may trade "at a discount (price below par, if market rates have risen." Why?

Barry Nielsen, Get Acquainted With Bond Prices and Yields. Investopedia, Nov 15, 2013
http://www.investopedia.com/articles/bonds/07/price_yield.asp
(Bonds "are priced at a discount because the coupon rate [the interest rate the bond issuer sets prior to the bid] on the bond is below current market rates")