If you are serious about small groups, your rifle must be up to the task to start. What does that mean? For me the trigger makes all the difference. I'd rather have a $200 rifle with an incredible trigger than a $1000 rifle with a crap trigger. Barrel and trigger is where your accuracy is at outside of the shooter having the skill to wring the full potential of rifle.
Once you meet criteria #1 and are truly interested in small groups, then don't waste your time with sub $4/50 ammo, and go straight to the good mid-level offerings. Lead shoots better than jacketed in my experience as I'm sure most competition guys will agree. What you are looking for is consistency, and that comes at a price (velocity, rim thickness, concentric, etc) all come into play.
Buy a box (50) of several quality makes/grains and see what she likes best.