When a bond is sold for less than its par value, it is considered to be sold at:

When a bond is sold for less than its par value, it is termed as being sold at a discount. This situation typically occurs when the bond's coupon rate is lower than the current market interest rates. Investors demand a higher yield than what the bond can provide based on its stated interest payments. As a result, to attract buyers, the bond is sold at a price below its par value.

This discount compensates investors for accepting a lower income stream from the bond compared to newer issues in the market that may offer higher interest rates. The bond's discount can be seen as a reduction to account for the bond's lower attractiveness in terms of cash flows compared to other investment options available at the time. Thus, the price that investors are willing to pay reflects the required yield in the current market environment.

Understanding this concept is crucial in finance, as it influences investment decisions and bond pricing strategies. In contrast, bonds sold at a premium reflect higher prices than the par value when they provide more favorable terms relative to interest rates, while face value refers to the bond's nominal value and market price indicates its current trading price, which can fluctuate.