Because bonds can have a different par value, the practice is to quote the price of a bond as a percentage of its par value. A value of “100” means 100% of par value. So, for example, if a bond has a par value of $1,000 and the issue is selling for $900, this bond would be said to be selling at 90. If a bond with a par value of $5,000 is selling for $5,500, the bond is said to be selling for 110.

When computing the dollar price of a bond in the United States, the bond must first be converted into a price per US$1 of par value. Then the price per $1 of par value is multiplied by the par value to get the dollar price. Here are examples of what the dollar price of a bond is, given the price quoted for the bond in the market, and the par amount involved in the transaction:¹