The figure may be labelled as shown.
We shall join the centres of all the circles by horizontal and vertical lines and then label the resulting figure as shown.
The simplest squares are ABED, BCFE, DEHG, EFIH, GHKJ and HILK i.e. 6 in number.
The squares composed of four simple squares are ACIG and DFLJ i.e. 2 in number.
Thus, 6 + 2 = 8 squares will be formed.