The "diversity" question and the "challenge" question are often difficult for students as rumor, myth, and misunderstanding often narrow how they view they should answer these questions. First of all, these answers do not have to be somehow medical, academic, or research. Trying to twist and construct an answer that fits these preconceived requirements typically reads exactly like that. Not a sincere, real answer but trying to make something fit that just doesnt.
Read each question carefully for each school but typically this isnt simply how you have dealt with "diversity" in the common societal/political meaning of different race, ethnicity, religion, etc. It really means what characteristics and/or experiences do you have that can add to the diversity of the class or more broadly how are you unique. You can of course, answer this in the common societal/political sense with experiences like tutoring underprivileged youth, working with a homeless population, etc. It can be a study abroad in a different cultural or country. But it can also be anything about you or your life that may give you a different POV than a "typical" applicant. You grew up in small rural town, in the middle of the inner city, you were an military brat, you were in the military, you had any sort of atypical educational background such as home schooled or went to a very small school, you lost a parent at a young age or were raised in a single parent household, you are an immigrant or first generation in US, your are first in college, you had some experience or job that put you in the middle of wide variety of people, you had a full time job, you are a parent, you were history or economics major, you spent a summer on an archaeologic dig or being a camp counselor. It is what these experiences say about you, what you learned from these experiences, and what you then bring to your potential medical school class and classmates from these experiences and background.
The challenge question can also cover much of the same experiences but with a slightly different POV of what you had to overcome. In addition to the ideas I suggested above, it can be almost anything. The importance here is not necessarily the actual act you did but the internal and personal challenges you had to face and overcome and what that says about you. Something as simple as trying out for the school play for a self-described shy student, moving away to college if you have some atypical or strong family background if you were say, the oldest child of a single mother and felt more than just older sister or brother to your siblings), spending a summer backpacking, having your car break down while in a foreign country. Again, everyone has had some personal challenges, many that may seem minor and of no consequence, that can say alot about you.
So I tend to suggest people at least think about these two big questions, either getting a couple of ideas for each or how to express ideas differently for each
