To configure versions based on a versioning rule, use EdAdmin4 (Security > Versioning rules) or Administrative Browser (Expiration and Versioning).

Create a new versioning rule, with the desired settings, as below:

An alternative is to use the Administrative Browser. On the Expiration and Versioning, add a rule with the desired settings, as below:

To make effective the versioning rule, assign it to a partition and then assign folders to the same partition.

See About initial and last versions and About version mode.