This manual is designed to provide primary health care program managers with guidance on how to use cost analysis and cost-effectiveness analysis as tools to achieve better understanding and management of resource flows. Although it has been prepared primarily for program managers at national, regional, and district levels, other health professionals can learn from it through a short training course or by individual study. Part A introduces unit financial costs and provides a first look at the effectiveness of health services, in six modules: what costs are, using cost data, planning the study, calculating costs, measuring effectiveness, and calculating unit financial costs. Part B covers other kinds of costs and compares costs and effectiveness estimates. Topics of the three modules are as follows: measuring and using economic costs, household costs, and cost-effectiveness analysis. In part C, several important uses of cost and cost-effectiveness data for planning and management are discussed and illustrated. Future costs, financial analysis, and managerial efficiency are the topics of the three modules. A set of exercises to be used with the individual modules follow. Appendixes contain the following: annualization factors; 10 resources for further reading, including guidelines and methods and case studies; and an index. (YLB)