what is a growth curve 
a growth curve is a graphical representation how how something changes over time an example of a growth curve might be a chart showing a country s population increase over time growth curves are widely used in statistics to determine patterns of growth over time of a quantity be it linear exponential or cubic 1 businesses use growth curves to track or predict many factors including future sales understanding a growth curvethe shape of a growth curve can make a big difference when a business determines whether to launch a new product or enter a new market slow growth markets are less likely to be appealing because there is less room for profit exponential growth is generally positive but could mean that the market will attract a lot of competitors growth curves were initially used in the physical sciences such as biology 2 today they re a common component of social sciences as well 1advancements in digital technologies and business models now require analysts to account for growth patterns unique to the modern economy for example the winner take all phenomenon is a fairly recent development brought on by companies such as amazon google and apple researchers are scrambling to make sense of growth curves that are unique to new business models and platforms growth curves are often associated with biology allowing biologists to study organisms and how these organisms behave in a specific environment and the changes to that environment in a controlled setting 2shifts in demographics the nature of work and artificial intelligence will further strain conventional ways of analyzing growth curves or trends analysis of growth curves plays an essential role in determining the future success of products markets and societies both at the micro and macro levels example of a growth curvein the image below the growth curve displayed represents the growth of a population in millions over a span of decades the shape of this growth curve indicates exponential growth that is the growth curve starts slowly remains nearly flat for some time and then curves sharply upwards appearing almost vertical this curve follows the general formula the current value v of an initial starting point subject to exponential growth can be determined by multiplying the starting value s by the sum of one plus the rate of interest r raised to the power of t or the number of periods that have elapsed in finance exponential growth appears most commonly in the context of compound interest the power of compounding is one of the most powerful forces in finance this concept allows investors to create large sums with little initial capital savings accounts that carry a compounding interest rate are common examples 