Anything may be copied for the purposes of examination, which includes setting examination questions. The only exception is that you may not copy sheet music for performance. The other constraint to be aware of is that this exception applies only for 'the purposes of examination' and does not extend to any subsequent (or prior) use you may want to make of the material, including putting it on a web site, or publishing copies of past examinations, or putting copies on public display. If you want to do any of these things and you have copied a substantial part of a work, you need to seek permission from the copyright holders.