Production for Montana and Missouri

	Amount Produced in 24 Hours:
	Baskets	Birdhouses
Montana	4	12
Missouri	8	8

Given the production information in the above table, it is evident that has the comparative advantage in producing baskets and has the comparative advantage in birdhouse production.

If each state were to devote 1/2 of their resources (12 hours) to the production of each good, Montana could produce at most baskets and birdhouses. Missouri could produce at most baskets and birdhouses. Call this the "no-trade" situation.

Now suppose each state specializes in the good for which it has a comparative advantage. The basket-producing state trades 4 baskets in exchange for 6 birdhouses from the birdhouse-producing state. Compared to the no-trade situation above, the gains from tradeare as follows: Montana enjoys additional and Missouri can consume additional .