Is selling a internet advertisement such as a banner advertisement space profitable?
Which one is more profitable: selling banner space, Google adsense or pay per click?
How much can we earn from selling a banner space?

All depends on the amount of visitors your get. Netgiants such as Newgrounds, Netlog, Facebook are very profitable because of the millions of visitors they get daily.
I think if you don't get a few thousand visitors a day, your website won't be profitable with AdSense or PpC.

You might go ask around, or place your own ad telling people you sell banner/partner space on your website. That would be the most profitable way with a low amount of visitors. Then again, companies don't feel like investing money in a site no one visits.