Answer:
A. Hijos is the answer
Step-by-step explanation:
José y Diego son los ________ de sus padres. 
In English the sentence is.
José and Diego are the ________ of their parents. 
a. hijos c. sobrinos b. nietos d. primos
In english
a.children c. nephews b. grandchildren d. cousins
So the answer A makes sence 
I hope I helped :)