In June 1974, the United States and Panama agreed on a treaty after two rounds of negotiations. The following point allocations are taken from The Art and Science of Negotiation (1982) by Howard Raiffa:
| Issue |
United
States
|
Panama
|
| 1 US defense rights |
22
|
9
|
| 2 Use rights |
22
|
15
|
| 3 Land and water |
15
|
15
|
| 4 Expansion rights |
14
|
3
|
| 5 Duration |
11
|
15
|
| 6 Expansion routes |
6
|
5
|
| 7 Compensation |
4
|
11
|
| 8 Jurisdiction |
2
|
7
|
| 9 US military rights |
2
|
7
|
| 10 Defense role of Panama |
2
|
13
|
| Total |
100
|
100
|
The United States wins on issues 1, 2, 4, and 6 (its points are underlined above), giving it 64 points (22 + 22 + 14 + 6), whereas Panama wins on issues 5, 7, 8, 9, and 10, giving it 53 points (15 + 11 + 7 + 7 + 13). The players tie on issue 3, which we initially give to the US for an initial allocation of 79 points.
Issue 3 has the smallest point ratio (15/15 = 1.0) and becomes the first issue used in the equitability adjustment. Let p denote the fraction of that issue that the US will retain, and (1-p) the proportion that Panama will retain; then p must satisfy the following equation
64 + 15p = 53 + 15(1 - p)
Solving for p, we find that p= 4/30 = 2/15. Thus, the United States should get 13.3 percent of its position (2 points), and Panama 86.7 percent of its position (13 points) on issue 3 to equalize their point totals. This results in the United States and Panama receiving each receiving 66 of their points.