So the exponential function is given by
which evaluated at a real number x gives you the value eˣ, hence the name. There are various ways of extending the above definition, such as to complex numbers, or matrices, or really any structure in which you have multiplication, summation, and division by the values of the factorial function at whatever your standin for the natural numbers is.
For a set A we can do some of these quite naturally. The product of two sets is their Cartesian product, the sum of two sets is their disjoint union. Division and factorial get a little tricky, but in this case they happen to coexist naturally. Given a natural number n, a set that has n! elements may be given by Sym(n), the symmetric group on n points. This is the set of all permutations of {1,...,n}, i.e. invertible functions from {1,...,n} to itself. How do we divide Aⁿ, the set of all n-tuples of elements of A, by Sym(n) in a natural way?
Often when a division-like thing with sets is written like A/E, it is the case that E is an equivalence relation on A. The set of equivalence classes of A under E is then denoted A/E, and called the quotient set of A by E. Another common occurence is when G is a group that acts on A. In this case A/G denotes the set of orbits of elements of A under G. This is a special case of the earlier one, where the equivalence relation is given by 'having the same orbit'. It just so happens that the group Sym(n) acts on naturally on any Aⁿ.
An element of Aⁿ looks like (a[1],a[2],...,a[n]), and a permutation σ: {1,...,n} -> {1,...,n} acts on this tuple by mapping it onto (a[σ(1)],a[σ(2)],...,a[σ(n)]). That is, it changes the order of the entries according to σ. An orbit of such a tuple under the action of Sym(n) is therefore the set of all tuples that have the same elements with multiplicity. We can identify this with the multiset of those elements.
We find that Aⁿ/Sym(n) is the set of all multisubsets of A with exactly n elements with multiplicity. So,
is the set of all finite multisubsets of A. Interestingly, some of the identities that the exponential function satisfies in other contexts still hold. For example, exp ∅ is the set of all finite multisubsets of ∅, so it's {∅}. This is because ∅⁰ has an element, but ∅ⁿ does not for any n > 0. In other words, exp 0 = 1 for sets. Additionally, consider exp(A ⊕ B). Any finite multisubset of A ⊕ B can be uniquely identified with an ordered pair consisting of a multisubset of A and a multisubset of B. So, exp(A + B) = exp(A) ⨯ exp(B) holds as well.
For A = {∗} being any one point set, the set Aⁿ will always have one element: the n-tuple (∗,...,∗). Sym(n) acts trivially on this, so exp({∗}) = {∅} ⊕ {{∗}} ⊕ {{∗∗}} ⊕ {{∗∗∗}} ⊕ ... may be naturally identified with the set of natural numbers. This is the set equivalent of the real number e.
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