It is important to realize that SharePoint stores a complete binary copy of every version of your document in the SQL Server database.
If the "Require Check Out" option is not enabled and a user forgets to check out the document first, a new version will be created every time a user saves the document to the server. This can lead to hundreds of versions of a document over time. But, if the document is checked out before it is edited, all changes will be saved to the same checked-out version
For example, you have a document that is 250 KB in size and you create three past versions of it along with the current version, a total of 1000 KB will be stored in the database along with appropriate metadata for each version. This formula applies equally to both major and minor versions.
PS: "Required Check Out" option is found on the Versioning Settings page of the Document Library Settings.
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