20" iMac with Dual Monitor?

I have a 20" iMac (early 2009) and i love it! However I've learned lately of dual monitor setups. Can the iMac handle a dual monitor setup? And what are the advantages of a dual monitor setup? I use my iMac for email, web browsing, ichat, ilife, iwork, and mostly word processing on ms office (for school, reports etc.).
What are the pros/cons of dual monitor setup and would I benefit from a dual monitor setup?
Any information and photos of dual monitor setups are welcomed.

The second display extends your Desktop. So you can place your windows on either screen. It's basically like having a bigger screen - more space to work in. That's the main pro.
There are no cons, except maybe the extra space the second display will occupy on your real desktop. On really old Macs, the second display had an impact on performance, but that is a non-issue on current system because the video hardware and CPU are more than powerful enough to run two displays.
Once you connect the second display, you can set it up in System Preference Displays pane Display tab. You can arrange the relative locations of the two screen on the Arrangement tab. You can even move the menu bar and Dock to the second display, if you want to use it as your primary screen.

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