"...and cost is an issue so please give me you most economical options."

Good luck, Roe. The only "weakness" of the 318 is with factory slugs you can't get any compression....you're more or less "stuck" with 8:1 and no quench which hurts power and to rebuild one with good slugs you can build a 360 just as cheap.

Go with a quick ramp cam like a Comp XE to trap more cylinder pressure and keep the duration in the 216-224 @ .050 range....you can mill the heads but it doesn't help your quench 'cause it doesn't do anything for the poor piston to deck of the slugs.

By the time you port and mill the heads and put in new valves you're going to have ~$700 or more into what are still 318 heads.....the heads to use are the late 80's heart shaped chamber heads if you're going to do a swap.....also if you have the $$$$ you might consider getting a set of closed chamber Edelbrock RPM's for $1100, that way if you go to a 360 or something later you have them to grow into. Saves about 45 pounds too.

If money is tight, your best bang for the buck mod on a stock 318 is small dual plane 4bbl, 600 carb, & dual exhaust. With a 340 cam, it should run as well as 90% of the stock 340's did back in the day.