In most cases, these error messages appear when there isn't enough memory
allocated to the Finder when running under MultiFinder.
When you are running in Finder only, the Macintosh allocates all available
memory to the Finder until an application is run. When you are running
under MultiFinder, the Finder is treated as an application and is given a
set amount of memory to work with.
To determine if your problem is insufficient memory allocated to the Finder
when you are running under MultiFinder, restart your Macintosh in Finder
only mode. Then try the same function that resulted in the error message.
If you don't get the error message, you need to increase the memory
allocated to the Finder when you are running in MultiFinder.
How To Increase Finder Memory Allocation
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1) Start up your Macintosh in Finder only mode.
2) Open the System Folder of the startup disk, and click the Finder file.
3) From the File menu, choose Get Info (or simply press Command-I on the
keyboard).
4) In the Get Info window, increase the amount of memory shown in the
Application Memory Size box. Note that any additional memory that is
allocated to the Finder will not be available to applications. A good
starting point is to increase the memory allocation by 100K.