3. Carthage Research, which has a 12% required rate of return, has applied for a federal grant.

There is a 25% chance that the grant will be fully funded, in which case it will provide $200,000 1 year from now. There is a 40% chance that the grant will be partially funded, in which case it will provide $50,000 1 year from now. In either case, if the research goes well, the grant will be renewed for an additional 4 years. Carthage estimates that there is a 70% chance that the research will go well.

Calculate the expected net present value of the grant.