Does practice of coding and algorithm on paper is more usefull or just practice it in compilers itself will make one confidence enough to participate in online coding compititions.
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While participating in a contest most people first solve the question on paper in form of a rough pseudocode or in a form of visualization so that while coding they have to think less and hence less chances of bugs
So IMHO while practicing also one should try to solve first on paper as u will get in this habit and hence your accuracy will improve but later u can skip solving the easy ones on paper and can directly start on compiler so that u can improve your speed also 
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The best way to solve the problems is to use pen and paper for writting algorithm or pseudo code and to draw the corresponding diagram if possible because it helps you to understand the problems clearly, and you should always go for dry run before using compiler. Because it increases your programming skills and reasoning power also.
But in case of online compititions it is neccesary to be habituated with the atmosphere of online system. For that reason you can give such kind of online mock tests. There are so many sites available for giving free online mock tests like indiabix.com,speed4career.com etc.
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Thanks Sidhant for your valuable comment…according to you which language is good for me ( as i m new to programming )- c or c++.
Both the languages C or C++ are equally good but from contest point of view C++ is one step ahead coz of STL. So I would recommend u C++.Spend some time with it…solve easy section problems and also most important see other people code (obviously after u solve it or in case u r not able to solve after several attempts)
Dont go for STL now… atleast after 2 months…
Best of Luck
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