Each of the sides of a square $S_1$ with area $16$ is bisected, and a smaller square $S_2$ is constructed using the bisection points as vertices. The same process is carried out on $S_2$ to construct an even smaller square $S_3$. What is the area of $S_3$?
$\mathrm{(A)}\ \frac{1}{2}\qquad\mathrm{(B)}\ 1\qquad\mathrm{(C)}\ 2\qquad\mathrm{(D)}\ 3\qquad\mathrm{(E)}\ 4$
Since the area of the large square is $16$, the side length equals $4$. If all sides are bisected, the resulting square has side length $2\sqrt{2}$, thus making the area $8$. If we repeat this process again, we notice that the area is just half that of the previous square, so the area of $S_{3} = 4 \longrightarrow \fbox{E}$