Although the official requirements for running Windows 7 is just 1 GB, I would not try to run Windows 7 on less than 2 GB of RAM. I think 4 GB is ideal. I once saw my Windows 7 RAM usage go close to 4 GB while installing an anti-virus program.
http://windows.microsoft.com/en-us/windows7/products/system-requirements
The cost of another GB of RAM depends on how many modules you currently have -- if you have two memory slots and only one is filled with a 1 GB module, then you only have to buy another 1 GB. If you have only two slots and both are filled with 512 MB, then you would have to toss those out and buy two 1 GB modules.
It also depends on what type of RAM your system uses, either the older DDR2 or the now common DDR3. Prices vary.