Recently much work has reported regarding EOQ models for deteriorating items with delay in payments. Most of these papers considered that there is no change of money value over time. But money value changes due to inflation. Hence, in this paper we develop and analyze an EOQ model for deteriorating items with the assumption that delay in payments is allowed under inflation. It is assumed that the life time of the commodity is random and follows a Weibull distribution. It is further assumed that the demand rate is time dependent and follows power pattern, with different values of indexing parameter the demand rate may increase or decrease or remains constant. Using the differential equations the instantaneous state of inventory at a given time is obtained explicitly. With plausible cost considerations under inflation the total cost function over the horizon is derived. The net profit rate function is also obtained. By maximizing the net profit rate function the optimal ordering and price policies are obtained. It is observed through sensitivity analysis that the deterioration distribution parameters, demand rate parameters and inflation rate have significant influence on the optimal operating policies of the model. The permissible delay in payments affects the ordering quantity and cycle time. This model also includes some of the earlier models as particular cases for specific values of the parameters.

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