Although you have clearly mentioned that you have selected
.NET Framework Version = v4.0.XXXXX in application pool, but your error says you still have .NET Framework Version = v2.0.XXXXX selected.
Go to the IIS again and check.
IIS -- Right Click on your hosted website -- Advanced Settings -- Application Pool -- Select version 4.0
If this doesn't work then make sure that you have installed .Net framework 4.5 in your system.
How to find the .NET version?[
^]
Hope, it helps :)