Should the teacher be informed about students who copied exam answers, and is that considered cheating?

Cheating is a reprehensible character and an evil act that a Muslim is not permitted to do. It is your duty to advise anyone you see practicing cheating or committing any forbidden act according to Islamic law, for the Prophet, peace and blessings be upon him, said: "Religion is advice." You are not required to inform the teacher or anyone else.