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Just so my answer is clear; there is a difference between knowledge and intelligence. In my opinion tests are not a good way to measure intelligence but tests can measure knowledge.

For example, I am an ARRL Volunteer Examiner and I've helped to administer tests for amateur radio licenses. To get a basic Technician class license a candidate has to pass a multiple choice test. It doesn't matter how intelligent the candidate taking the test is. What matters is that the candidate can demonstrate knowledge of what the basic FCC laws are, how to operate a radio transmitter without causing interference of other radio communications and basic safety when working with electricity.

Not really i can't say the test are best way to prove your knowledge but the public or your professors and teachers has to know if you've been following up is teaching that's why test are held some one may have a broad knowledge about things but still fail a test because he did not read what was passed on to them by the professors and teachers but failing the test does that mean you are not brilliant the answer is no.

It can be considered in two ways.

The tests that we go through during our academic life cannot be called as a measure of our knowledge. Most of it just tests our memorising power.

Give the person a live, on the spot problem and see how he solves it. How he analyse it and the way he arrive at a conclusion can be used to measure his knowledge in the field.

There is no test  for 'cop on"