Parameter optimization of an induction machine is discussed from the viewpoints of the consumer and the national economy. The parameters thus determined ensure minimum cost but not normal machine properties. The object of the analysis was to determine the direction of change of the normal parameters which would ensure reduction in cost. Optimization was effected on seven principal parameters with calculations carried out on a digital computer. The optimized machine obtained has an extremely small inner stator diameter and length of laminated core, excessive stator slot and yoke depths, a large rotor slot section, and a very high air gap induction. Calculation results yielded the breakdown of the annual cost of the machine which consisted of material and loss expenditures.