Inkscape is free!
Inkscape is an open-source alternative to Adobe Illustrator and has all the basic vector drawing tools you would expect. The all-important pen tool is there, as are tools for shapes, text and making selections.
Objects can be cloned, copied and pasted, placed on separate layers and transformed, although there’s no support for free or perspective transform.
That, however, is one of the few features that you’ll miss when switching from Illustrator. Granted, things work differently in Inkscape, and it takes some getting used to and a few trips to the comprehensive Inkscape wiki in order to comprehend it, but when you do, you’ll find that most of what you can do in Adobe’s heavyweight can be accomplished in Inkscape. For example, Pathfinder operations in Illustrator are called Boolean operations in Inkscape, but amount to the same thing. There’s no brushes palette in Inkscape, but you can apply any brush path to an editable path. There’s even a trace feature to rival Illustrator’s Live Trace.
Inkscape has advantages over Illustrator too, particularly when it comes to editing paths. Nodes, for example, change in appearance depending on what kind of node they are. Convert a corner node to a smooth node, and it changes from a diamond to a square. Also, nodes can be moved, selected, and handles rotated and scaled using keyboard shortcuts. Illustrator features that haven’t yet made it to Inkscape include gradient meshes, colour management for print, and the ability to alter graphs by editing their data.
Inkscape is based on the SVG format, but can also open Illustrator documents from version 9 onwards. It can export to PDF, but there’s no support, however, for EPS files.
Inkscape runs on top of X11, so you’ll need to download that if you haven't got it installed. Like most open-source apps, the documentation for Inkscape (in the form of a wiki) is comprehensive and provides a full guide to the Illustrator-equivalent tools in Inkscape.