Concept:
Area of a rectangle is:
\[
A=l\times b
\]
If both length and breadth are increased, the new area is found by multiplying the increased dimensions.
Step 1: Assume original length and breadth.
Let the original length be \(l\) and breadth be \(b\).
Original area:
\[
A=lb
\]
Step 2: Increase each side by \(10\%\).
New length:
\[
l+\frac{10}{100}l=1.1l
\]
New breadth:
\[
b+\frac{10}{100}b=1.1b
\]
Step 3: Find new area.
\[
A'=1.1l\times 1.1b
\]
\[
A'=1.21lb
\]
Step 4: Find percentage increase.
\[
\text{Increase}=A'-A
\]
\[
=1.21lb-lb
\]
\[
=0.21lb
\]
Percentage increase:
\[
\frac{0.21lb}{lb}\times 100=21\%
\]
\[
\therefore \text{Correct Answer is (B)}
\]