Step 1: Understand the geometry.
PQRS is a square with side = 2 cm. Rectangle PLMN is inscribed such that:
- \(L\) lies on side QR.
- \(MN\) passes through vertex \(S\).
Thus, PLMN is a tilted rectangle inside the square.
Step 2: Use symmetry and diagonals.
The rectangle's diagonal \(PN\) and \(LM\) align symmetrically across the square. The maximum rectangle possible has its sides inclined at 45° inside the square.
Step 3: Find the effective sides.
- Length \(PL = \sqrt{2}\) (projection of the square side onto diagonal).
- Breadth \(LM = \sqrt{2}\).
Thus, rectangle PLMN has sides each equal to \(\sqrt{2}\).
Step 4: Area calculation.
\[
\text{Area} = \text{Length} \times \text{Breadth} = \sqrt{2} \times \sqrt{2} = 2
\]
Wait–check carefully. Actually, by construction rectangle PLMN's one side equals 2 and the other equals \(\sqrt{2}/2 \times 2 = \sqrt{2}\). Hence,
\[
\text{Area} = 2 \times \sqrt{2}/2 \times 2 = 2\sqrt{2}
\]
Step 5: Conclude.
Therefore, the area of rectangle PLMN is:
\[
\boxed{2\sqrt{2} \;\text{cm}^2}
\]