This paper presents a novel model for resource bounded computation based on process algebras. Such model is called the $-calculus (cost calculus). Resource bounded computation attempts to find the best answer possible given operational constraints. The $-calculus provides a uniform representation for optimization in the presence of limited resources. It uses cost-optimization to find the best quality solutions while using a minimal amount of resources. A unique aspect of the approach is to propose a resource bounded process algebra as a generic problem solving paradigm targeting interactive AI applications. The goal of the $-calculus is to propose a computational model with built-in performance measure as its central element. This measure allows not only the expression of solutions, but also provides the means to incrementally construct solutions for computationally hard, real-life problems. This is a dramatic contrast with other models like Turing machines, l-calculus, or conventional process algebras. This highly expressive model must therefore be able to express approximate solutions. This paper describes the syntax and operational cost semantics of the calculus. A standard cost function has been defined for strongly and weakly congruent cost expressions. Example optimization problems are given which take into account the incomplete knowledge and the amount of resources used by an agent. The contributions of the paper are twofold: firstly, some necessary conditions for achieving global optimization by performing local optimization in time and/or space are found. That deals with incomplete information and complexity during problem solving. Secondly, developing an algebra which expresses current practices, e.g., neural nets, cellular automata, dynamic programming, evolutionary computation, or mobile robotics as limiting cases, provides a tool for exploring the theoretical underpinnings of these methods. As the result, hybrid methods can be naturally expressed and developed using the algebra.
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