Question

elle vend du pain.oui,elle ---- vend.

Answer 1

You need a pronoun here.
What pronoun do you use that replaces "de + something/somewhere" ?
What pronoun do you use that replaces "à + something/somewhere" ?

Answer 2

No, this answer is not correct.
"du pain" is indefinite, so you need an indefinite pronoun.

Such pronouns are "y" and "en".
In that case, the correct pronoun is "en", because the complement is introduced by the preposition "de".

Elle vend du pain. Oui, elle en vend.