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When I'm training in a friendly gym, sometimes I know I can only beat up to the first or second trainer in the gym. Also I see no reason to needlessly put my Pokemon to 1 HP when I know I will lose.

After I've beaten one or two trainers, does giving up during the battle of the third trainer forfeit the XP and prestige I would've earned for beating the first trainers?

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You get prestige and xp for every pokemon you beat even if you give up later on. It's actually a very nice strategy to put a very weak pokemon in the gym and only keep beating it to level your gym

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    You gain more prestige based on the CP difference, so it's best to put in a Pokemon that you can counter easily and then use a lower CP pokemon to defeat it, I can get about 800 prestige for defeating a single pokemon this way.
    – Aequitas
    Jul 19, 2016 at 0:25

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