Cloud computing environment provisions the supply of computing resources on the basis of demand, as and when needed. It builds upon the advances of virtualization and distributed computing to support cost efficient usage of computing resources, emphasizing on resource scalability and on-demand services. It allows business outcomes to scale up and down their resources based on needs. Managing the customer demand creates the challenges of on demand resource allocation. Further, they can make use of companywide access to applications, based on a pay-as-you-go model. Hence there is no need for getting licenses for individual products. Virtual Machine (VM) technology has been employed for resource provisioning. It is expected that using virtualized environment will reduce the average job response time as well as executes the task according to the availability of resources. Effective and dynamic utilization of the resources in cloud can help to balance the load and avoid situations like slow run of systems. In this paper, various resource allocation strategies and their challenges are discussed in detail. It is believed that this paper would benefit both cloud users and researchers in overcoming the challenges faced.

Cloud is a type of parallel and distributed system consisting of a collection of virtualized and interconnected computers that are dynamically provisioned and presented as one or more unified computing resource based on Service Level Agreements (SLA) established through negotiation between the service provider and consumers. Cloud computing is an internet -based computing in which large groups of remote servers are networked to allow sharing of data-processing tasks, centralized data storage, and an online access to computer services or resources. It relies on the sharing of resources to achieve coherence and economies of scale, similar to a utility (like the electricity grid) over a network. Cloud computing also focuses on maximizing the effectiveness of the shared resources. Cloud resources are not only shared by multiple users but are also dynamically reallocated on demand. The main enabling technology is virtualization. Virtualization software allows a physical computing device to be electronically separated into one or more "virtual" devices, each of which can be easily used and managed to compute tasks. Virtualization provides the agility required to speed up IT operations, and reduces costs by increasing infrastructure utilization. Scheduling is important for an operating system. CPU scheduling deals with the problem of deciding which of the processes in the ready queue is to be allocated CPU time. When a job is submitted to a resource manager, the job waits in a queue until it is scheduled and executed. The time spent in the queue, or wait time, depends on several factors, including job priority, the load on the system, and availability of requested resources. Turnaround time represents the elapsed time between when the job is submitted and when the job is completed. It includes the wait time as well as the jobs actual execution time. Response time represents how fast a user receives a response from the system after the job is submitted. Resource utilization during the lifetime of the job represents the actual useful work that has been performed. System throughput is defined as the number of jobs completed per unit time. Mean response time is an important performance metric for users, who expect minimal response time.

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