How was Bilbo's change positive, and where is it evident in The Hobbit?

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The change in Bilbo is positive because he demonstrates great bravery and resourcefulness.

The change in Bilbo is mentioned in Chapter 8, specifically.  It is the first time Bilbo has to fight after getting the ring and returning to his friends. 

[They] had changed their opinion of Mr. Baggins very much, and had begun to have a great respect for him (as Gandalf had said they would). (Ch. 8)

In this chapter, Bilbo fights the spiders, and very successfully.  He shows that he has strength, cunning, agility, and bravery.  Bilbo was only a regular hobbit when he first began the journey.  His strongest traits were probably loyalty and curiosity.  Now he has a host of others.

When he encountered Gollum in the cave, Bilbo used his intelligence and wit, along with luck and a cool head, to win his freedom in the riddle game.  He had picked up the ring and put it in his pocket, and managed to use it to escape.  Once in the enchanted woods in Mirkwood, it proved invaluable against the huge spiders.

Hobbits are clever at quietness, especially in woods, as I have already told you; also Bilbo had slipped on his ring before he started. That is why the spiders neither saw nor heard him coming. (Ch. 8)

Bilbo managed to fight the giant spiders with Sting and save his friends.  Unfortunately, they went from spiders to elves.  However, as we learn at the end of the chapter, Bilbo will soon prove useful there too!

Bilbo progresses along a hero's journey throughout the book, and the hero's journey is all about change.  Heroes also collect things throughout the journey.  They collect objects, such as the sword and the ring, but they also collect skills.  Bilbo collected his bravery and his fighting ability.  He also changed in negative ways, because he became more secretive.  He did not tell them everything about the ring.

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