Consider the following sequential game between firm 1 and firm 2. First, firm 1 decides to adopt either technology A or technology B. Second, Firm 2 observes firm 1's decision and then also decides between technology A or technology B. The profits (in millions of dollars) of the firms are as follows.

If both adopt technology A, then firm 1's payoff is $65 and firm 2's is $75. If firm 1 adopts technology A and firm 2 adopts technology B, then the payoff for firm 1 is $50 and for firm 2 is $70. If firm 1 adopts technology B and firm 2 adopts technology A, firm 1's payoff is $70 and firm 2's is $50. If both adopt technology B, then firm 1 makes $75 in profits and firm 2 makes $55. Finally, if the two firms adopted different technologies the game ends. But if firm 2 adopts the same technology as firm 1 then firm 1 can sue firm 2 for infringement. If firm 1 chooses not to sue the game ends. If firm 1 decides to sue then firm 2 must pay firm 1 $10 in damages. Using the principle "look ahead and reason back" (i.e., backward induction), the most reasonable prediction is

A) that both firms adopt technology A and firm 1 sues.

B) that firm 1 adopts technology B and firm 2 adopts technology A.

C) that both firms adopt technology B and firm 1 does not sue.

D) that firm 1 adopts technology A and firm 2 adopts technology B.