AP MicroeconomicsMarket Failure & Government
Lorenz Curve
The Lorenz curve is a graphical representation of income or wealth distribution within a population, comparing actual distribution to perfect equality.
It plots cumulative percentages of income against cumulative percentages of households, with perfect equality shown as a 45-degree line. The further the curve is from this line, the greater the inequality. It is used to visualize the extent of income disparity in a society.