Professor Wendy Smith has been offered the following opportunity: A law firm would like to retain her for

an upfront payment of $$49,000.$ In return, for the next year the firm would have access to eight hours of

her time every month. As an alternative payment arrangement, the firm would pay Professor Smith's

hourly rate for the eight hours each month. Smith's rate is $$550$ per hour and her opportunity cost of

capital is $16\%$ per year. What does the IRR rule advise regarding the payment arrangement? $($Hint: Find

the monthly rate that will yield an effective annual rate of $16\%.)$ What about the NPV rule?

The annual IRR is

$\%.($Round to two decimal places.$)$