Why do we have exams?

For a while now, I have been thinking about exams and why our performance in school is based on our results from exams(I hate exams).
The idea behind an exam is that you read, read, read until your brain is overloaded and then you walk to school with 1000 different thoughts in you head and you try to spit them out during the coming 1hours.
Most often, on a simple piece of paper. Paper and pen, 2010?
I've been dealling with computers for my whole of 2 years(almost) in TP and in about 1 hour time, i'm going to take a paper (wtf yes!) which I've zero idea about it. During lessons, I did ewebapp on computer and now paper? Helllooo who are you kidding? Who am I suppose to do a paper when in class we only use the com?

I'm so sad. I can't study. I hate what I'm doing now ):