
Each triangle in the figure above is an isosceles right triangle with sides 1, 1 and √2.
Shaded region = 4 triangles.
Largest square = 16 triangles.
Thus:
(shaded region)/(largest square) = 4/16 = 1/4.
The correct answer is C.

We can let the side of the largest square be 10. Thus the side of second largest square is 10/2 x √2 = 5√2 and the side of the smallest square is (5√2)/2 x √2 = 5. Now, the area of the largest, second largest and the smallest squares are 10^2 = 100, (5√2)^2 = 50 and 5^2 = 25, respectively. The shaded area is the difference between the area of the second largest and smallest squares, so it's 50 - 25 = 25. Thus the fraction of the largest square is shaded is 25/100 = 1/4.


