Costs/Revenue

Invest in R&D (200,000) Case 1.1 Case 1.2

Don't - Invest (200,000) Invest (200,000)
Succeed Succeed
Proposal (50,000) Propose (50,000) Propose (50,000)
No Proposal - Win 850,000 Don't Win -
Total 600,000 (250,000)
Win Contract (150,000) Probability 0.48 Probability 0.12
Don't - Expected Income 288,000 Expected Income (30,000)

Win Contract 1,000,000 Case 1 175,000

Don't - Case 2 (7,500)

If she has old tech, she shouldn't propose

If she has new tech she shouldn't bid
Therefore the answer simplifies to
Case 1.1 Case 1.2
Invest (200,000) Invest (200,000)
Succeed Succeed
Propose (50,000) Propose (50,000)
Win 850,000 Don't Win -
Total 600,000 (250,000)
Probability 0.48 Probability 0.12
Expected Income 288,000 Expected Income (30,000)

Case 1 178,000
Case 2 (7,500) At best, she can just simplify this to 0, by not even
 Case 1.3 Case 1.4 Case 2.1
Invest (200,000) Invest (200,000) Don't Invest - Don't Invest
Don't Succeed Don't Succeed Don't Succeed Don't Succeed
Propose (50,000) Propose (50,000) Propose (50,000) Propose
Win 850,000 Don't Win - Win 850,000 Don't Win
600,000 (250,000) 800,000
Probability 0.02 Probability 0.38 Probability 0.05 Probability
Expected Income 12,000 Expected Income (95,000) Expected Income 40,000 Expected Income

Case 1.3 Case 2.1

Invest (200,000) Don't Invest - Don't Invest
Don't Succeed Don't Succeed Don't Succeed
Don't Propose - Don't Propose (50,000) Propose
Win - Win 850,000 Don't Win
(200,000) 800,000
Probability 0.4 Probability 0.05 Probability
Expected Income (80,000) Expected Income 40,000 Expected Income

just simplify this to 0, by not even proposing.

Case 2.2
-

(50,000)
-
(50,000)
0.95
(47,500)

Case 2.2
-

(50,000)
-
(50,000)
0.95
(47,500)