Which is the best low cost layer-2 switch to connect with cisco 1800 series router?

You could use a 2950, you can divide all your departments into Vlans, specially if you have more than 100 users, is not recommended by cisco to have more than 100 users on the same Vlan, 2950 are cheap but not best solution if you do have a little more in your budget i will recommend 3750, as you can use them in stack, 3 4 switches like 1, but those are 3 switches