A description of the 1974-75 Michigan Cost-Effectiveness Study and its findings is provided in this study. The present study is restricted to compensatory education reading programs. Its purpose is the development of the analytical techniques reflected in the cost-effectiveness model. A purpose of the study is the investigation of the direction of the relationships between achievement and various identified variables. Although all of the possible analyses on the data are not completed, the development of various path models present a major step in identifying the nature of the significant relationships between various variables and reading achievement. This study focuses upon educational variables which can be changed or controlled by educational systems. Variables such as race, social economic status, level of parental education, etc. which can not be readily controlled or modified by an educational system are not examined. (Author/AM)