Adaptive mode is a setting that determines how a question behaves in a quiz activity. (The quiz activity type is used for a variety of assessments which may be labelled assignments, assessments, submissions, tutorials, tests and exams. You know its a quiz if the link to it on the course page has an icon like this: .)
If a quiz uses adaptive mode, then students can receive feedback immediately after attempting each question within a single quiz attempt. Moreover, students can attempt each question more than once before moving on from it (or later, before finishing the quiz.) This is beneficial because you can get the answer right in your mind before continuing, regardless of the mark you achieved.
You can easily tell if a quiz uses adaptive mode by looking for a "Check" button beneath each question. After selecting what you think is the right answer, click "Check" to check if you are correct. If you were wrong, try again.
Adaptive mode does not use negative marking. Instead (generally) it reduces the maximum mark that can be achieved in each successive question attempt until finally it is zero. Thus, in a multiple-choice question with four choices, a student would typically merit:
100% of the question value if they got it right first time;
66.7% of the question value if they got it right second time;
33.3% of the question value if they got it right third time;
0 if they got it right fourth time.
So, if the question is worth 1 mark, the four scenarios above would achieve 1 mark, 2/3 mark, 1/3 mark, and 0 marks respectively. However, if there are only two choices (as in the case of True/False or Yes/No questions, among others), a student who does not get it right on his first attempt gets zero for that question because there is only one other choice, so the right answer is obvious after the first attempt.
Adaptive mode is usually used for formative assessments. In other words, for activities in which participation is intended to improve learning. Adaptive mode is typically not used for exams, since exams (summative assessments) are not designed as learning activities.