What is Lorenz curve in SAP CEC-MKT-ML-PRE - Predictive Studio?

SAP Term: Lorenz curve

• Component: CEC-MKT-ML-PRE

• Component Name: Predictive Studio

• Description: A chart that shows the cumulated percentage of top-scored customers x-axis by the coverage of actual buyers in the training set y-axis as calculated during model training.

Smart SAP Assistant

• Key Concepts: 
  The Lorenz curve is a graphical representation of the distribution of wealth or income in a population. It is used to measure the degree of inequality in a society. The curve is created by plotting the cumulative percentage of the population against the cumulative percentage of income or wealth held by them. The further away the curve is from the 45-degree line, the greater the inequality in the society. 
  
  How to use it: 
  The Lorenz curve can be used to measure inequality in a population. It can be used to compare different populations or to compare different points in time for a single population. It can also be used to compare different countries or regions. The Lorenz curve can be used to identify areas where inequality is particularly high and to identify policies that could reduce inequality. 
  
  Tips & Tricks: 
  When using the Lorenz curve, it is important to remember that it only measures relative inequality and not absolute inequality. This means that it does not take into account factors such as poverty or wealth. It is also important to remember that the Lorenz curve does not take into account factors such as age, gender, race, or other demographic characteristics. 
  
  Related Information: 
  The Lorenz curve is related to other measures of inequality such as the Gini coefficient and the Atkinson index. These measures are more complex than the Lorenz curve but provide more detailed information about inequality in a population. They can also be used to compare different populations or different points in time for a single population.