Two 1 inch by 1 inch squares are cutout from opposite corners of a 7 inch by 5 inch piece of paper to form an octagon. What is the distance, in inches, between the two dotted points, both of which lie on corners of the octagon?
[asy]
size(120);
draw((0,1)--(0,5)--(6,5));
draw((1,0)--(7,0)--(7,4));
draw((0,1)--(0,0)--(1,0),dashed);
draw((6,5)--(7,5)--(7,4),dashed);
draw((0,1)--(1,1)--(1,0));
draw((6,5)--(6,4)--(7,4));
draw((1,1)--(6,4),dashed);
dot((1,1),linewidth(5));
dot((6,4),linewidth(5));
label("?",(1,1)--(6,4),N);
[/asy]
<spanclass=′latex−bold′>(A)</span>5<spanclass=′latex−bold′>(B)</span>34<spanclass=′latex−bold′>(C)</span>52<spanclass=′latex−bold′>(D)</span>8<spanclass=′latex−bold′>(E)</span>74