I bought a surprisingly decent cheap electric guitar *with amp* (a Silvertone) for $100 at Wal-Mart a couple of years ago, for a son who, in the end, never got serious about playing the guitar.
The instrument is nothing special, and the amp is dinky -- a "practice amp" -- but the strings stay in tune and the action is nice and low, very easy to play. It turned out to be fairly ideal as an instrument on which to learn. I fool with it once in a while, especially when I have a chance to play it through a *real* amp, but generally much prefer my own 35-year-old acoustic dread.
I don't think a similarly-priced acoustic would have been nearly as playable. I've been playing for 40 years, and I can't hold the strings down to get a decent sound out of most cheap high-action acoustic guitars. I have come to the conclusion that -- contrary to what certainly seems to make sense -- a beginner might very well be better off with a cheap electric guitar than a cheap acoustic.
Of course, if what your son really wants is an acoustic dreadnaught, he won't be at all pleased with a brand-X electric axe.
Yamahas are decent instruments, and their dreadnaught models are quite popular. Also, as MG mentioned, Epiphone (Gibson's bargain nameplate, formerly an independent company) and Fender Squire are reliable lower-priced brands.
As others have noted, every individual instrument is different, and an experienced player should help you shop in order to help choose the best single guitar from among those available in your price range. Also, while a music store will probably charge a higher price than a discount chain, the difference is worth it *if* the music store employes craftsmen who will set up the instrument for you.
Shopping for used guitars *might* yield a real "diamond in the rough," a very good instrument for a bargain price, but would require time and consultation with someone who can offer a bit of expertise.