Translation:The students are sitting at the tables and studying.
Duolingo is fairly consistent at rendering "-nál/nél" as either "at" or "by", and at rendering "mellett" as either "next to" or "beside". This seems correct to me.
OTOH, it's not so consistent about whether "-nál/nél" is "at" or "by", nor about whether "mellett" is "next to" or "beside". I've been reporting, and y'all should too.
I am pretty sure this should be sitting AT the table. In English sitting by the table suggests they are sitting somewhere near it but not using it. Other sources suggest I am correct.