EXPENSES IN DISTRICTS I AND II 311 
are low or high, respectively. But the other things are not equal. 
It is the relations between gross earnings and total expense ratios 
which determine ratios of net earnings. And these are functions 
of variables with respect to both factors. Neither of them can 
be considered without respect to the other. 
The detail and averages in Table 183 refer to the entire bank- 
ing membership in the Boston district for the years 1924 and 
1925, averages for the different volume groups for the respective 
years for both total expense and net earnings ratios being the 
standards of reference from which the deviations in the paired 
series are computed. But the relations found to obtain for the 
entire membership for the combined years hold for each year. 
Moreover, they are true for each city-size group for each year 
and for the combined years and for each volume group each 
year, the averages used as points of reference in order to deter- 
mine the deviations being those applying to the respective groups 
and years. That is, negative correlation seems to be independent 
of the period covered and of the manner in which the banks are 
selected. The rule is general. 
TABLE 184 
CORRELATION OF DEVIATIONS OF RATIOS IN PAIRED SERIES—MEMBER 
BANKS, BostoN FEDERAL RESERVE DISTRICT, 1924 AND 1925 
‘Percentage Deviations from Respective Yearly Averages for the 
Respective Volume-Groups. See page 2%9.) 
Pnhcition 
A have 
Below 
[NDEPENDENT VariasLE—Ratios of 
Total Expense to Earning Assets 
Y-+ance from Average 
recente 
> anc over 
‘0 and under 40 
‘= 2nd under 30 
0 and under 2. 
Inder 10 
Jnder 10 
0 and under 20 
~ and under 3c 
nd under 4¢ 
wel er 
Average 
Darcantapa 
Number 
of 
Rank-Years 
DEPENDENT VARIABLES— 
Net Average Percentage 
Gross 
‘arnings 
to 
‘arning 
Assets 
Net Earn- 
ings to 
Earning 
Assets 
a 6B 
*+13.9 paired with net earnings. 
b<458 2 paired with net earnings. 
$302 for total expense paired with net earnings, 
119 for total expense paired with net earnings.