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I'm ok with coding on a whiteboard in an interview but I prefer it to be at a casual-ish level. I want to get high level data out of the process, not running code. I want to see how someone thinks through the process of transitioning from problem solving to coding. I want to see how they firm up requirements for the solution. I want to see people's code habits, I want to see their abilities to analyze and critique their own code. I tend to use pretty easy problems for such things (like factorial) so I can focus on those other bits. I find it works pretty well.

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