Here are the most appropriate words to fill in the blanks in the text:
A - 3) many Peter studies many subjects such as English and Math.
B - 3) their
Peter's parents are very happy with their choice.
C - 1) can
but now Peter can speak very well.
D - 4) most interesting
For him, Russian is the most interesting language in the world.
E - 2) went
Last year Peter went to Russia on an exchange programme.
So the complete text would read:
Peter Watson is twelve years old and he lives in London, the UK. He goes to school. He is very busy because at school he studies many subjects such as English and Math. He also studies a foreign language. He studies Russian. Peter's parents are very happy with their choice. Russian is a very difficult language but now Peter can speak very well. Peter likes Russian. For him, Russian is the most interesting language in the world. Last year Peter went to Russia on an exchange programme. He spent two weeks in Moscow and made some friends there. He hopes to visit Russia again in the future.