This exercise can be played a couple different ways. The easy way would be to simply play the notes how they're indicated in the tab below. But if you want to give the pattern some extra rhythmic flavor, I'd recommend adding some subtle percussive elements to your picking.
When you watch the video above, you'll notice I play it once slowly without adding anything fancy. But the next time I play it, you'll hear me adding a lot of percussive sounds to my picking. All I'm doing there is basically creating dead notes (muted notes) between the notes that I actually want to be heard. Do you notice how my picking hand keeps moving with the tempo? While my picking hand does that, I also let the pick gently brush against the strings. Simultaneously, I use my fret-hand to mute the strings in between the notes that I actually want to be heard.
If adding the rhythmic stuff in between the notes is too difficult for you at this point, go ahead and play it the simple way where you just play the notes in their indicated spots. But also try to find time to practice implementing the percussive elements in your picking. If you can get used to that technique, it can add a lot to your overall rhythm playing.
See you in Exercise 3!