A subscription model grows by 7% each month. What kind of growth does this imply?

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Multiple Choice

A subscription model grows by 7% each month. What kind of growth does this imply?

Explanation:
When growth happens by a constant percentage each period, each month's increase is based on the current total, so you multiply by a factor like 1.07 every month. This creates exponential growth, since after n months the size is the starting amount times 1.07^n. If growth were linear, you'd add the same fixed number each month; if it were logistic, it would slow as it nears a limit; and no growth would mean no change at all. So a 7% monthly increase corresponds to exponential growth.

When growth happens by a constant percentage each period, each month's increase is based on the current total, so you multiply by a factor like 1.07 every month. This creates exponential growth, since after n months the size is the starting amount times 1.07^n. If growth were linear, you'd add the same fixed number each month; if it were logistic, it would slow as it nears a limit; and no growth would mean no change at all. So a 7% monthly increase corresponds to exponential growth.

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