What you need to know is where the encoder is fitted, (final counts/rev) and what the system you are using will allow, and what resolution do you want/need.
For e.g say you have an encoder on a motor which operates a .25" pitch ball screw directly.
If you had a 1kpulse/turn encoder and most controls will allow increasing this resolution on a quadrature encoder to x4.
Therefore this will result in (4x1000)x4=16,000 pulses/inch which equates to a resolution of .0000625 per pulse.
If you have any gearing between motor and ball screw this will affect the resolution proportionately.
Al.