The predicted net profit margin for a company with a fixed asset turnover of 2 times is closest to:
A. 1.1889 percent.
B. 1.8043 percent.
C. 3.2835 percent.

Espey Jones is examining the relation between the net profit margin (NPM) of companies, in percent, and their fixed asset turnover (FATO). He collected a sample of 35 companies for the most recent fiscal year and fit several different functional forms, settling on the following model:
ln(NPM_i)= b₀ + b₁FATO_i.
The results of this estimation are provided in Exhibit 1.

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Exhibit 1: Results of Regressing NPM on FATO Sum of Squares Source Regression Residual Total Intercept FATO df 1 32 33 Coefficients 0.5987 0.2951 102.9152 2.2152 105.1303 Standard Error 0.0561 0.0077 Mean Square 102.9152 0.0692 t- Statistic 10.6749 38.5579 F 1,486.7079 p-Value 0.0000 0.0000 p-Value 0.0000