I thought Ecuador would be even cheaper than it is, but it is not bad. Here are some examples:
1) Food. Can differ up to 100% or more depending on where you go shopping. We go to Supermaxi (Megamaxi) supermarkets, the most expensive but also the most civilized place (actually very similar to Publix in Florida), spending around $100 weekly for 2 adults, not limiting ourselves in anything. Poor people supermarkets like Santamaria, Tia and others can cut the bill as much as 50%. Farmer markets even more. Eating out is cheap and of acceptable quality. Small canteens sell breakfasts for under $2 and lunches for under $3. Not bad. Places like SwissHotel in Quito offer first world level on everything: quality and prices.
2) Accomodation. You can find decent hostels for $10 a night in Mariscal area, that is where you most likely end up when you fly into Quito. Decent long term rental starts at $250 a month to my taste, but can be as low as $100 depends on what you consider decent.
3) Public transportation costs $0.25 within the city, and it is all righ in Quito. Taxis are dirt cheap when they turn on taximeters. For $5 you can get basically from anywhere to anywhere in Quito. Most people we know chose to buy a car, however car prices are generally higher than in US.
4) Services. Electricity: $22 a month, Internet(500k) + phone from Telmex $23 a month, basic cable from TVCable $12.00 a month, a small tank of gas (natural gas) is $1.60 and lasts for about 2 months. Cell phone from Alegro with Blackberry Internet service: $55.00 for 2 lines a month.
5) Tax. Sales tax is 12%, it is normally included in all the prices displayed. As an expat you won't be paying any income tax. Property tax is cheap: a luxury apartment in Quito pays maybe $500 a year.
6) Health services are cheap, but it is a cash only deal. Health insurance for a couple of our age runs about $100 a month.
Ask questions if I missed anything.

 

If you want more some comfortable and luxurious you can go for any 5,7 star hotel but if want only a simple stay and food then 1000$ is sufficient for you to visit, stay, food for a month in some cities such as Quito, Galapagos and so many.

 

thanks for the answer. I was just looking at this place, and strangely enough, the question of the cost of living was the most intriguing. So your comment was very helpful.

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I would also like to know your opinion on the climate of Ecuador. How quickly were you able to adapt? Were there any problems with this?