Draw a figure.
Let the radius of the circle be 1.
The area of a rectangle with corners on the circle will be given by
A = 2x * 2sqrt(1-x2) = 4xsqrt(1-x2)
dA/dx= 4{[-x2/sqrt(1 - x2)] + sqrt(1 - x2)}
Set the derivative = 0 and solve for x.
You should find that the rectangle you want is a square!