1960 AHSME Problem 7

Circle I passes through the center of, and is tangent to, circle II. The area of circle I is 4 square inches. Then the area of circle II, in square inches, is:

\textbf{(A) }8\qquad \textbf{(B) }8\sqrt{2}\qquad \textbf{(C) }8\sqrt{\pi}\qquad \textbf{(D) }16\qquad \textbf{(E) }16\sqrt{2}

Full credit goes to MAA for authoring these problems. These problems were taken on the AOPS website.