... need to have in the future? – Down payment = 1( 150 ,000) = 15, 000 – Closing costs = 05( 150 ,000 – 15, 000) = 6, 750 – Total needed = 15, 000 + 6, 750 = 21, 750 • Compute the number of periods – PV = - 15, 000; ... rate – the longer the time period, the lower the present value – What is the present value of $50 0 to be received in years? 10 years? The discount rate is 10% – years: N = 5; I/Y = 10; FV = 50 0 ... = 50 0 CPT PV = -192.77 5C-17 Present Value – Important Relationship II • For a given time period – the higher the interest rate, the smaller the present value – What is the present value of $50 0...