The Adaptive mode setting allows multiple attempts for each question. This is different than Attempts allowed, which allows multiple attempts at the whole quiz.
In an adaptive quiz, when a student answers a question incorrectly, the quiz redisplays that question and gives the student another chance to answer it correctly. How many attempts the student gets is determined by how much you penalize the student for each wrong attempt.
For example, let's assume that you penalize the student 50 percent for a wrong answer. If the student gets a question wrong, they can try once more for half points. If the student gets the second attempt correct, they get half credit. If they get it wrong, the system subtracts another 50 percent from ...