Skip to content
RED SAGSkills
mediumAI Engineer (LLM & Generative AI) interview question

How do you decide between better prompting, RAG and fine-tuning for a new use case?

What the interviewer wants to hear

  • Start with prompting and an eval set as a baseline
  • RAG for knowledge: private, large or changing data
  • Fine-tuning for behaviour, format, style, or a smaller cheaper model
  • Consider data availability, cost, latency and maintenance
  • Often combined

Model answer

I start with prompting and build an eval set first, so I can measure every option. Good instructions and a few examples solve many problems cheaply and quickly. If the gap is missing knowledge, such as company documents, product data or anything that changes often, I add RAG or tool calls, because fine-tuning is a poor way to store facts and is hard to update. If the gap is behaviour, like a strict output format, a domain writing style, or a classification task the model keeps getting wrong despite good prompts, fine-tuning helps, especially when I have hundreds or thousands of good examples. Fine-tuning a smaller model can also cut cost and latency once a large model has proven the task. These approaches combine: a fine-tuned model can still use RAG. I always compare against the prompted baseline.

Can you answer it under time pressure?

Take a timed medium round and get scored on every answer.

Start mock interview

More medium AI Engineer (LLM & Generative AI) questions