 Solution

Put $\mu =GM$. Balancing Newton's law of universal gravitation with the required centripetal force gives $m{v}_0^2/r_0=\mu m/r_0^2$, henceThe circular Kepler orbit is stable against small radial perturbations: its effective radial potential is $U_{\mathrm{eff}}=J^2/(2m{r}^2)-\mu m/r$, and at the circular value $J^2=\mu m^2{r}_0$, $U_{\mathrm{eff}}^{\prime \prime }(r_0)=\mu m/r_0^3>0$. Here $J$ is the conserved angular momentum.