You are given a background paragraph that describes one or more causal or qualitative relationships such as a relationship in economics or a scientific law and a story that makes use of the concepts or the relationship described in the provided paragraph. You are also given a question about the story that requires an understanding of the relationship described in the background paragraph and the story. You need to come up with an answer to the given question; the answer will be a span from either the question or the story. In order to correctly answer the given question, you need to understand the relationship mentioned in the background paragraph and should be able to use it to understand that in the story. Your answer can not consist of any word that is not mentioned in any of these: the background paragraph, the story, or the question. You can directly copy and paste a span from the story or the question while answering the given question.

Background Paragraph: The trade-off theory of capital structure is the idea that a company chooses how much debt finance and how much equity finance to use by balancing the costs and benefits. The classical version of the hypothesis goes back to Kraus and Litzenberger[1] who considered a balance between the dead-weight costs of bankruptcy and the tax saving benefits of debt. Often agency costs are also included in the balance. This theory is often set up as a competitor theory to the pecking order theory of capital structure. A review of the literature is provided by Frank and Goyal.[2]

An important purpose of the theory is to explain the fact that corporations usually are financed partly with debt and partly with equity. It states that there is an advantage to financing with debt, the tax benefits of debt and there is a cost of financing with debt, the costs of financial distress including bankruptcy costs of debt and non-bankruptcy costs (e.g. staff leaving, suppliers demanding disadvantageous payment terms, bondholder/stockholder infighting, etc.). The marginal benefit of further increases in debt declines as debt increases, while the marginal cost increases, so that a firm that is optimizing its overall value will focus on this trade-off when choosing how much debt and equity to use for financing. 
Story: Company X stopped taking on more debt, and decided to file for bankruptcy, while company Y, kept benefiting from the tax benefits of debt, having a lower debt level. 
Question: Which company had more costs than benefits related to debt, company X or company Y?
company X.

Background Paragraph: The example of someone having a positive experience with a drug is easy to see how drug dependence and the law of effect works. The tolerance for a drug goes up as one continues to use it after having a positive experience with a certain amount the first time.[38] It will take more and more to get that same feeling. This is when the controlled substance in an experiment would have to be modified and the experiment would really begin. The law of work for psychologist B. F. Skinner almost half a century later on the principles of operant conditioning, "a learning process by which the effect, or consequence, of a response influences the future rate of production of that response.[39]. 
Story: The Roach Runners met to discuss their experiences. They all said they always had a great experience using roach and used the same amount each time. They told how many times they used roach. Chris used it 12 times, Johnny used it 22 times, Earl used it 32 times, Jimmy used it 42 times, Antonio used it 52 times, Danny used it 62 times, and Bryan used it 72 times. 
Question: Who has a higher tolerance for roach: Jimmy or Danny?
Danny.

Background Paragraph: Generally, nearsightedness first occurs in school-age children. There is some evidence that myopia is inherited. If one or both of your parents need glasses, there is an increased chance that you will too. Individuals who spend a lot of time reading, working or playing at a computer, or doing other close visual work may also be more likely to develop nearsightedness. Because the eye continues to grow during childhood, myopia typically progresses until about age 20. However, nearsightedness may also develop in adults due to visual stress or health conditions such as diabetes. A common sign of nearsightedness is difficulty seeing distant objects like a movie screen or the TV, or the whiteboard or chalkboard in school. 
Story: Two coworkers are sitting in the large break room eating lunch and watching the news on TV when they see an advertisement for glasses. John, upon seeing the ad, comments that he really should go and get a new pair since he is nearsighted and hasn't gotten a new pair of glasses in a couple years. Rick says he is glad that he doesn't need to wear glasses because it seems like such a pain to have to always have something on your face. John nods in agreement and then both men turn to see a woman at the other side of the break room waving at them and trying to get their attention. 
Question: Is Rick more or less likely than John to correctly identify the woman?

more.

