That's not actual growth though, that's just measuring the same business in a different unit worth 0.97 of the old unit. The business can be the same size.
The question asked was “Why is it bad to earn a constant (in nominal terms) profit rather than an increasing profit.” The size of the business is irrelevant to this question. I answered the question, the short answer is ‘inflation’.
When responding to a question, I choose to answer the question the person asked instead of another question they didn’t ask.
When responding to a question, I choose to answer the question the person asked instead of another question they didn’t ask.