The effects of various economic and engineering parameters on the initial and operating costs of a specific optimal rectangular air supply duct system are studied. Among the parameters considered are: (a) material and installation cost, (b) energy cost, (c) prevailing interest rate, (d) system useful lifetime, (e) average daily operation time, and, (f) permissible air velocities. The optimal design is calculated by a modified static regain method and is obtained by the. reduced gradient optimization method. Results indicate that both system operating and initial costs are inversely proportional to the prevailing interest rate. System operation costs are found to be more sensitive to increased energy costs than is system initial cost. It is also found that system total cost tends to decrease as long as air velocity constraints are permitted to attain higher vaiues.