I have a very tight budget and would as of now prefer the cheapest option out there.
Also, do i need to give any other specification about my computer to understand what would be best to upgrade?
So buy two 1gb sticks of DDR ram 400mhz. your board supports dual channel and 400mhz is the maximum memory bus frequency it can handle, you will notice a good gain from that.
The hard drive is fine but I would recommend Western Digital.