The doubling period

Many things grow, but not all things grow in the same way. There are two basic ways for something to grow: linearly, and exponentially. When something grows linearly it grows repeatedly by the same amount; when something grows exponentially it grows repeatedly by the same proportion.

 

If something grows constantly, it will eventually double its original size. The period of time it takes to double is the doubling period; the doubling period is a useful concept when examining exponential growth.

 

The doubling period of something that is growing exponentially is easy to calculate approximately from the percentage growth rate: you divide the regular percentage growth rate into the number 70. For example, if we have $100 growing exponentially at 10% in each year, dividing 10 into 70 gives seven years to approximately double it. You can easily check this by performing the calculation; starting with $100 and adding 10% for each year:

 

The $100 has approximately doubled after 7 years.

 

This page is linked from:

how money is created 

economic growth

resource recycling and economic growth

 

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