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It is considered that men with more then 25% and women with 30% more body fat are obese. For the correct assessment, either

skin fold thickness test or under water weighing could be done.Body fat measurement

The absolute waist circumference ( > 102 cm in men and > 88 cm in women) or waist – hip ratio (>0.9 for men and >0.85 for women) are a measure of central obesity.

With day to day advancements and better understanding, it has become clear that visceral fat or central obesity (male type or apple type obesity) has a stronger relation with cardio-vascular diseases. Body Mass Index (BMI) does not take into account the adipose and lean ratios.

Waist circumference
BMI   > 40                =  Severely obese

BMI   30 – 39.9         =  Obese

BMI   25 – 29.9         =  Overweight

BMI  18.5 – 24.9       =  Normal weight

BMI  < 18.5              =  Underweight
BMI is indexed as follows for reference:or    BMI = Weight (lbs) * 703 / height (inches)2So   BMI = Kg / square ms. 
BMI = Weight in Kilograms / Square of height in meters. 
Body mass index is the most simple and useful index to estimate body fat. It is calculated as follows:

BMI

If you are using pounds and inches for a child's weight and height, the formula to calculate BMI is:

BMI = [weight / (height x height)] x 703

Again, in this BMI formula, the child's weight is in pounds and his height is in inches and you basically 'calculate BMI by dividing weight in pounds (lbs) by height in inches (in) squared and multiplying by a conversion factor of 703.'

BMI Formula (Metric Units)

If you are using the metric system, the formula to calculate BMI is a little different. In this BMI formula, you use kilograms and meters for a child's weight and height:
BMI = [weight / (height x height)]
So using the metric system, 'the formula for BMI is weight in kilograms divided by height in meters squared.'

Understanding BMI

BMI (Body Mass Index) to assess your weight in relation to your height. In adults, once you calculate your BMI, it is rather easy to interpret your results, as a BMI between 25 to 30 is considered overweight and a BMI of 30 and above is considered obese.