What Is a Pie Graph Used For?

pie-graph-used Credit: John Lamb/Photodisc/Getty Images

A pie graph is an effective visual tool used for showing how something breaks into parts. A pie graph is essentially a circle sliced into 100 pieces. Each category or part represented in the pie graph is given a piece of the pie to represent the percentage that it comprises of the whole.

Each section in a pie graph is a different color so that viewers can easily see how the sections compare. Pie charts are often used to explain budgets, taxation issues or other financial matters.

For example, if someone wants to make a pie graph of the family budget, the total amount of money earned is represented by the chart as a whole. The pieces of the chart represent the different ways the family's earnings are spent. Different pieces could represent their taxes, grocery bills, car payments, savings contributions or any other categories that they wish to include in the budget. Using that chart, the family can easily determine how much of their income is going to various expenses.

If their yearly income is $100,000, and they spend $12,000 every year on mortgage payments, their mortgage expenses are going take up 12 percent of the pie — a small slice of the pie. However, if their income is $50,000, and their mortgage payments are still $12,000, the mortgage piece of the pie is going take up 24 percent — nearly a quarter of the pie. In either case, the data is clearly visible once presented in a pie graph.