LG display will build a LCD production plant at the cost of $ 4 billion. The plant will produce panels larger than 40 inches using glass substrates between 2200 mm and 2500 mm with a total capacity of 120,000 units per month. The plant has an expected life of 8 years with salvage value of $200 million. If a unit generates $781 in revenues against $210 in costs, fixed annual costs are $30 million per year, and the MARR is 10% per year, answer the following:
Assume the plant is completed in a year (time zero) and a loan for $1.5 billion was secured to pay for part of the expansion (the remaining funds come from the company's cash). The loan is to be repaid in 5 annual equal principal payments with an annual interest rate of 8%? What is the after tax cash flow (in millions) in year 1 but only with respect to the loan? Assume a 42% tax rate.