THIS DOCUMENT REPORTS AN INVESTIGATION ON THE FEASIBILTY OF COST EFFECTIVENESS TECHNOLOGY AS IT MAY BE APPLIED TO DECISIONS ABOUT MONEY SPENT ON EDUCATION. THE AUTHORS BELIEVE THAT IT IS FEASIBLE TO APPLY A SUITABLY MODIFIED VERSION OF COST/EFFECTIVENESS TECHNOLOGY TO MATTERS OF EDUCATIONAL EXPENDITURE. THE FOLLOWING PREREQUISITIES ARE LISTED WHICH SHOULD BE MET FOR EVALUATION EFFORTS TO BE SUCCESSFUL--(1) THE EVALUATION SHOULD NOT BE GEARED TO THE CALENDAR, BUT TO THOSE PERIODS OF TIME IN WHICH EDUCATIONAL OBJECTIVES CAN REASONABLY BE EXPECTED TO BE REACHED, (2) THE SCHOOL BUILDING, NOT TITLE I PROJECTS, SHOULD CONSTITUTE THE NATURAL UNIT FOR EVALUATION, (3) EMPHASIS SHOULD BE PLACED ON THE OUTCOMES OF AN EDUCATIONAL ACTIVITY RATHER THAN UPON DETAILS OF THE ACTIVITY, AND TO ILLUSTRATE, THE EFFECT OF AN EDUCATIONAL ACTIVITY DEPENDS ON WHAT THE CHILD ACTUALLY LEARNS, NOT ON WHAT THE TEACHER INTENDED TO TRANSMIT, AND (4) THE EVALUATION EFFORT MUST TAKE COGNIZANCE OF THE CHARACTERISTICS OF THE PUPIL, WHICH CONSTITUTE A VERY REAL PART OF HIS OWN LEARNING ENVIRONMENT. (TC)