Grading Policy - Negative Marks?

Is there some way we can introduce a policy such that the mark should be reduced with each incorrect answer ?
This will be helpful in conducting competitive examinations efficiently, to avoid wild guessing.

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@nadheemabdulla You are talking about problem components, right? You can limit the number of attempts students are allowed - for example to only allow one attempt, in which case they would be penalized if they don’t directly pick the right answer:

This setting specifies the number of times that a learner is allowed to try to answer this problem correctly. You can define a different Maximum Attempts value for each problem.

A course-wide Maximum Attempts setting defines the default value for this problem-specific setting. Initially, the value for the course-wide setting is null, meaning that learners can try to answer problems an unlimited number of times. You can change the course-wide default by selecting Settings and then Advanced Settings . Note that if you change the course-wide default from null to a specific number, you can no longer change the problem-specific Maximum Attempts value to unlimited.

Note: EdX recommends setting Maximum Attempts to unlimited or a large number when possible. Problems that allow unlimited attempts encourage risk taking and experimentation, both of which lead to improved learning outcomes. However, allowing for unlimited attempts might not be feasible in some courses, such as those that use primarily multiple choice or dropdown problems in graded subsections.