I can think of two plausible ways to translate this sentence into English — one referring to a future event, and the other referring to a regularly occurring event.
One possibility: “I am doing it in one week.” Here “I am doing it” really means “I plan/intend/expect to do it” (in the future), and “in one week” refers to a moment of time in the future, i.e. “one week from now”.
Another possibility: “I do it in one week.” Here, “I do it” refers to an action that takes place frequently or regularly, and “in one week” refers not to the timing of the action, but to its duration — not when, but how long.
Concrete example: Bob’s house needs to be repainted, and he is planning to do the work himself. His friend George asks about his plans.
George: “So, Bob, when are you going to paint your house?”
Bob: “I’m doing it in a week.”
Later Bob changes his mind and decides to hire someone to do the work. He calls a contractor, Steve, to discuss it.
Bob: “How long does it take you to paint a house?”
Steve: “I do it in a week.”
These are two very different meanings, and I would not expect another language to use the same wording for both. (Note that English uses similar, but not identical, wording.)
So… does this Hebrew sentence mean one of these things, or the other, or can it be used for both, or does it mean something else entirely?
The Hebrew sentence can have either the sense "I'll wait a week and then I'll do it", or "I'll do it during the next seven days." (I'm not offering these as real English sentences, but just trying to ensure that the two senses are distinct, even for those whose English is imperfect.)
To remove the ambiguity and give the sentence only the first sense, it can read:
אני עושה את זה בעוד שבוע.
- this is for real-life use, of course; I'm not suggesting you can force a "correct" mark out of Duolingo if you write it this way.
In English, “I’m doing this in one week” can mean “after one week goes by” or “in the duration of one week”, but probably neither of these meetings are intended because they are future and we haven’t learned future yet. I think the most probable meaning is a regular occurrence. But then the wording would be “I do this in one week”, such as how long it takes to paint a house, and not “I am doing this in one week”. There seems to be no way around this being future.
I beg to differ with the participants who said the Hebrew has both meanings. It definitely doesn't mean "I will do it a week from now". Maybe they misunderstood the question; it can refer to the future. But still it would mean how many days I'll spend on this task (at most), and does not say anything on when I'll start (or finish), in calendar terms.