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The Quiz activity module allows the teacher to design and build quizzes consisting of a large variety of Question types, including multiple choice, true-false, and short answer questions. These questions are kept in the Question bank and can be re-used in different quizzes.
Here's a good introductory video on creating a quiz, from Moodle:
Please see this page for more information:
https://docs.moodle.org/en/Quiz_activity