I know in the Ad Campaign activity you can set up how many days the ad should be served for, but in Ad Audience, there is no such option.

  1. Does it mean that the contact record will never be removed from that audience even when finishes/exits the journey?
  2. Is adding them into the Exclusion Audience or setting up the individual record retention in DE the only ways of removing them from ads?

Quotes from the Trailhead's module -

He drags an Ad Audience activity after the wait period to ensure an exit audience is created for suppression.

Customers that exit journeys aren’t automatically removed from that Advertising Audience, so it’s important to add in this suppression step to avoid retargeting the same customers.

In other words, you are correct by saying that the contact record will not exit the journey if you will not "help" him via Suppression/Exclusion Audience. Yet I am not sure about removing the contact's record from the DE by Retention Policy or any other way if that really would help the contact to exit the journey.

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