AHSME 1960 Problem 21

The diagonal of square $I$ is $a+b$. The area of square $II$ with twice the area of $I$ is: $\textbf{(A)}\ (a+b)^2 \textbf{(B)}\ \sqrt{2}(a+b)^2 \textbf{(C)}\ 2(a+b) \textbf{(D)}\ \sqrt{8}(a+b) \textbf{(E)}\ 4(a+b)$