なるほど。

Naruhodo.

I see. / That makes sense.

Word for word

“I see (it becomes so).”

Politeness: Neutral

Fixed expression that suits almost everyone, with no politeness marker to adjust.

When you would say it

Showing you follow an explanation.

Worth knowing

To a superior, add: なるほど、そうなんですね。 Bare なるほど can sound like grading them.