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In German, "read/reads" and "is/are reading" are the same. "He reads a newpaper" and "he is reading a newspaper" are both translated as "Er liest eine Zeitung." "I read a newspaper" and "I am reading a newspaper" are both translated as "Ich lese eine Zeitung." And, as in this example, "We read a newspaper" and "We are reading a newspaper" are both translated as "Wir lesen eine Zeitung."
You don't know - both "We are reading a newspaper" and "We read a newspaper" translate to German Präsens as there are no continuous/progressive tenses in German. Is it really that important to know...? When I started learning English it seemed weird to me that it is necessary to make this distinction in English...
However, if you want to emphasize that something is (or was) happening just at that moment (where you would use a progressive tense in English), you can add the little word "gerade" in German: "Wir lesen gerade die Zeitung."
Yes, it's supposed to be in the accusative form, that is why the feminine accusative eine is used here.
einen is specifically masculine accusative, but Zeitung is a feminine noun.
Feminine and neuter nouns, as well as all plural nouns, have an accusative form that looks exactly like the nominative form. Only masculine singular nouns have an accusative form that looks distinct.