Click the "More" dropdown and select the "Question bank" option. 
The question bank is where all the questions created inside the course is managed.

Click the dropdown and select "Categories".
Categories are folders within the question bank. It is recommended to build questions in appropriate categories to keep the question bank clean.

Click "Add category" to create a new category. Otherwise, select an existing category to build the question in (Shown in next steps).

Select the category to create questions in.

To add a question directly into the category folder,  click the "Create a new question..." button.

Choose the appropriate question type. Once selected click the "Add" button. Then create a question following the information based on the selected question type.

Once completed, click "Save changes" to add the question to the Question Bank.

Once all questions have been created, you will see them in a list, as well as the version of the question, if it's used in a course, when it was last used and who modified it.

The Question Bank: Adding and Accessing Questions