Creating an online exam is a two-step process. In the first step you specify the exam settings. In the second step you add questions to the exam.

Click the module access icon > Academics > Examination > Online Exam > New Online Exam to open the New Online Exam page.

In the Name field, enter the name of the exam.
In the Start date and End date fields, select the starting and ending date that the exam will be accessible to students. The exam will not be available to students before the starting date and after the ending date.
In the Maximum Time (Minutes) field, enter the duration of the exam. A countdown timer is shown when a student attempts an exam. When the timer runs out, the exam is submitted automatically with whatever answers the student has filled in.
In the Pass Percentage (%) field, enter the minimum percentage required to pass the exam.
Select the exam type from the following options:

General – The exam is not specific to any subject. If you’ve selected General; select a batch, and then select all or specific students.
Subject Specific – The exam is specific to a particular subject. If you’ve selected Subject Specific; select a batch, select a subject, and then select all or specific students.

Note: If the exam is being created for an elective subject, only students taking the subject will be listed.

Objective – Objective exams require a student to choose a response to a question whose correct answer is predetermined. At the end of the exam, the results are immediately displayed to the student.
Hybrid – Hybrid exams include both objective and descriptive type questions. Students can view the results only after the teacher has evaluated and published the results.

In the Assign Evaluators field, search (use the employee’s first name or employee ID to search) and select the employee who will evaluate the exam. You can assign any number of evaluators as you like.

Note: The field is available only if the exam format is Hybrid.

Click the Create button. This will take you to the Create Questions page where you can add questions.

You can add any number of questions as you like.

Use the text fields to enter the questions. For objective type questions, you will also have to enter the options from which the student will need to choose the correct answer(s). If you are creating a Hybrid format exam, select the question format, and then enter the question. If you want to give more choices from which the student will need to choose, click Add option. If you need to remove an option, click Remove option.

Text Editor – The text you enter in the text fields can be formatted using the basic formatting options available.

Select the Is answer checkbox for the correct answer, or answers in the case of multiple choice questions.
In the top right, enter the marks that will be awarded if a student gets the answer right.

Click the Create button and continue adding questions.
When you’ve completed adding all questions, click the Skip button. A preview of all created questions will be displayed.

For more information, view this:

How to create and add questions for online exam?