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What is exponential growth?

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Quick answer

Exponential growth is when something increases by a constant percentage each period, so it grows faster and faster over time. A small amount can become enormous surprisingly quickly — think compound interest or a spreading virus. The amount grows by a fixed percentage each step, not a fixed number.

Key things to understand

  1. The amount grows by a fixed percentage each step, not a fixed number.
  2. Growth accelerates: the bigger it gets, the faster it adds.
  3. Examples: compound interest, populations, viral spread.
  4. It's easy to underestimate — small starts explode over time.

People also ask

What's the difference between linear and exponential growth?
Linear adds a fixed amount each step; exponential multiplies by a fixed percentage, so it accelerates.
What is a real example of exponential growth?
Money in a compounding account, or the early spread of an infectious disease.
Why is exponential growth surprising?
It stays small for a while, then suddenly explodes — humans tend to underestimate it.