Complete the sentence using appropriate option. He _____ daily for a year now.

The correct answer is 'has been exercising'.

Key Points 

• This sentence is an example of the Present Perfect Continuous tense.
• This tense is used to represent an action that started in the past, continues in the present and may also proceed into the future.
  •  Structure  - Subject + have/has + been + present participle + the rest of the sentence
• In the context of the sentence, it's evident that the action (exercising) has been ongoing for some time (a year) and continues to he the present.
• Additionally, as the subject 'He' is third-person singular, the correct auxiliary verb choice to agree with it in the Present Perfect Continuous tense is 'has'.
• Therefore, the correct answer is Option 3.