Answer:
B. Market expansion
Step-by-step explanation:
The answer is in the question... if you analyze it a bit.
The question is talking about "selling in areas or to groups ", that's a definition of a market (not a product as suggested by answer choice C).
Then it mentions "previously not served by the business.", so we know it's a market where the business didn't sell before... going into that market is an expansion of the business.
So, overall, we're talking about a market expansion.
Market penetration is a measure on how well you do in a given market, this company didn't sell at all in that market, so it's not just an increase of the penetration.
Product expansion would be adding new models to a product line.
Diversification would mostly be creating new products, in other niches.