Goodbye, high return. You shouldn't assume a municipal bond is a good deal for you unless you carefully compare the bond rate and the potential savings for your individual tax bracket. A new retiree shouldn't put all of his or her money into long-term bonds with the goal of living off the income. Long-term bonds are highly volatile and probably won't keep up with inflation. A bond selling at par is worth the same amount it will be redeemed for at maturity.
Most bonds pay interest semiannually, which is called the coupon.
The market price is what you can sell your bond for before its maturity. The current price depends on market conditions. What's most important is the total return, a combination of the annual interest and the bond's gain or loss in market value. The easiest bond transactions are for new issues, offered to the public by government bodies or corporations. The issuer pays the broker's commission.