When I'm developing on my laptop and use responsive design mode with a device selected like the iPhone 6 it overflows vertically (image attached). There is enough space for it to not overflow but the chrome above the device takes up a lot of vertical space. I would guess that most people use responsive design for mobile layout so I'd expect any vertical space to be used sparingly by the chrome. Dedicating space for the label "Responsive Design Mode", the close button, and the width/height seems wasteful.

I've attached a screenshot of a more compact layout that would solve this.