Two approaches for conceptualizing and estimating a contextual model for analyzing student achievement are the separate equation approach and the single equation approach. The separate equation method determines the relationship between the individual-level independent variable and the individual-level dependent variable within each group. It then determines the relationship of the within-group regression intercepts and slopes to the group-level independent variable based on the group mean. In this way, individual, group, and interaction effects are determined. The single equation approach, however, involves a single multiple regression analysis. The group variable and the interaction variable are assigned to each of the individuals in the groups. The partial regression coefficients have the same interpretation in terms of multilevel effects in both methods, but they will not always produce the same estimates of effects. Both approaches to contextual analysis use an ordinary least square estimation procedure, for which common computer packages are available. Computer simulations were carried out on large data sets representing teachers, students, and classes. Results suggest that the separate equation approach provides the most accurate picture of the actual precision of estimates. However, it was more costly. (GDC)