The approximate formula $mgh$ for gravitational potential energy can be used only when:

1. The formula $mgh$ assumes $g$ is constant over the height $h$. 2. The value of $g$ decreases as height increases, so this is only valid when $h$ is small. 3. When $h$ is small compared with the Earth's radius $R$, $g$ is nearly constant and $mgh$ holds. 4. For large $h$ the exact form $-\dfrac{GMm}{R+h}$ must be used, ruling out the large-$h$ options. _Source: Balbharati (Maharashtra Board) Class 10 Science & Technology, Ch 1 "Gravitation", p.22_