Problem 11-3 Effect of discount rate (LO11-3) A brilliant young scientist is killed in a plane crash. It is anticipated that he could have earned $280,000 a year for the next 40 years. The attorney for the plaintiff's estate argues that the lost income should be discounted back to the present at 7 percent. The lawyer for the defendant's insurance company argues for a discount rate of 14 percent. What is the difference between the present value of the settlement at 7 percent and 14 percent? Compute each one separately. Use Appendix D for an approximate answer but calculate your final answer using the formula and financial calculator methods. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Present Value PV atrale PV at 10 rate Derence