I can see Anthony Smith being about +170, but +250, really?
Some overlap with what others have written, but will still put down a few thoughts.
Anthony looked good against Glover until he gassed terribly. His corner moronically hyped him to set a pace he couldn't maintain for more than two rounds. They were clearly looking to put Glover out early, and, for what it's worth, Anthony has said as much in interviews. A ridiculously high-risk gambit considering that, though Glover was hurt by both Cutelaba and Roberson, he hasn't been finished since a last round stoppage against Gus in 2017. 1. I don't see him making the same mistake against Rakic. 2. Even if he does, he could still win a decision in a three round fight.
In a parallell universe where Lionheart finished Glover in the second round, my guess is he would be a slight betting favourite against Rakic. In which case the question is whether the consequences of taking that beating warrant him being a +250 underdog?
Mentally I think Anthony Smith will come back just fine. In fact, he seems to enjoy and take pride in viewing himself as an underdog: fighting big bad bullies and proving everyone doubting him wrong, and so on... He seemed fine mentally in the Gus fight, coming back after being completely nullified by Jon Jones. From a mental perspective this scenario seems similar in many ways.
Not that it's necessarily relevant, but to give some perspective on the odds:
Should Smith really be as big of an underdog against Rakic as Edgar was against Munhoz? Edgar is 38, cutting to bantamweight for the first time, fighting a hard hitter, and his chin is in question after being one-shot KO:ed.