This is the starting population, b . Each year 500 people migrate to Smalltown, so m is 500. So the line rises by 500 people each year. The same percentage increase of a growing amount means that the annual increase in number or amount is larger each year. For populations this means that people born in an earlier period have families of their own.
Exponential growth is the same as compound interest in economics.
Interest this period is earned on the original amount and all interest earned during previous periods. Because the size of the change in numbers increases every year, the graph of something growing exponentially curves up. The slope of the line increases every period. The graph of world population since 1900 shows such an increasing slope especially during the period 1940 through 1990. With Exponential Growth, the higher the growth rate the greater the increase in the slope of the line.