Divide the remaining figure into two rectangles. What is the total area of the remaining figure (pink shaded area)? How does it represent the difference of squares?

The correct answer is: x2 - y2 unit2

When we divide the red shaded area into two equal rectangles, it can be shown as

The dimension of each rectangle is 
Area of pink shaded region = Area of square of side x - Area of square of side y

= x² - y² unit²
As we have found the area of pink shaded region by finding the difference between the area of two squares. So, the area of pink shaded region represents the difference of squares.
Final Answer:
Hence, we have divided the remaining figure into two rectangles and the area of pink shaded region is   x² - y² unit².