Step 1: Understanding the problem.
We are given a large square with a side of 5 cm, and a smaller square with a side of 3 cm. The centers of both squares are the same, and the smaller square is cut from the larger one. The shaded portion is the area left after the smaller square is cut out from the larger square.
Step 2: Calculating the area of the larger square.
The area of a square is given by the formula:
\[
\text{Area of the larger square} = \text{side}^2 = 5^2 = 25 \, \text{cm}^2
\]
Step 3: Calculating the area of the smaller square.
Similarly, the area of the smaller square is:
\[
\text{Area of the smaller square} = \text{side}^2 = 3^2 = 9 \, \text{cm}^2
\]
Step 4: Finding the shaded area.
The shaded area is the area of the larger square minus the area of the smaller square:
\[
\text{Shaded area} = 25 - 9 = 16 \, \text{cm}^2
\]
Final Answer:
\[
\boxed{16 \, \text{cm}^2}
\]