Most lofty of everyone entering exam (7)
I believe the answer is:
tallest
'most lofty' is the definition.
('tall' can be a synonym of 'lofty')
'everyone entering exam' is the wordplay.
'everyone' becomes 'all' (I've seen this before).
'entering' is an insertion indicator.
'exam' becomes 'test' ('test' can be a synonym of 'exam').
'all' placed into 'test' is 'TALLEST'.
'of' is the link.
(Other definitions for tallest that I've seen before include "Most high" , "most exaggerated" , "Of extreme height" , "Most incredible" , "Highest in stature" .)