Professor Wendy Smith has been offered the following opportunity A law firm would like to rotain her for an upfront payment of 550,000 . In retum, for the nexd year the firm would have access to eight hours of her time every month. As an alternative payment arrangement, the frm would pay Professor Smith's hourfy rate for the eight hours each month. Smith's rate is $550 per hour and her opportunity cost of capital is 15% per year. What does the IRR rule advise regarding the payment arrangement? (Hint. Find the monthly rate that will yleld an effective annual rate of 15\%.) What about the NPV rule? The annual IRR is. The IRR rule advises (Select the best choice below.) A. With an IRR of 15% and with Smith's cost of capital at 10.67%, according to the IRR rule, she should reject this opportunity B. Since the IRR is less than the cost of capital, 15%, Smith should accept this opportunity. C. Since the IRR is less than the cost of capital, 15%,5mith should tuin down this opportunity. D. None of the above. The NPV is 3 (Round to the nearest dollar) The NPV rule advises (Select the best choice below.) A. Since the NPV is negative, the correct decision is to accept the upfront retainer B. Even though the NPV is positive, the IRR is hilgh enough to accept the upfront retainer: C. Even though the NPV is negatlve, the IRRR is below the cost of capital, so the correct decision is to reject the upfront payment. D. None of the above