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In general it is normal that virtualized system works slower, it need additional steps to accomplish the same task like on non virtualized hardware. However, it all depends on your real hardware and settings, and if you have decent hardware you should not notice decreased performance.
1GB should suffice for Ubuntu, but 3D games or more complicated applications need more. Be sure not to assign more than about 90% of your real free RAM to virtual machine, your real system still needs RAM to operate and if it consume too much it will start to use swap, that will decrase performance of both systems. Check settings of your virtual machine like: hardware virtualization (VT-x/AMD-V), Nested paging, IO APIC, 3D Acceleration. Without these setting you can get performance penalty. Also make sure you installed "Guest Additions" - available on Device menu after starting virtual system.
Also you did not mentioned what hardware, host and guest system you have: 32 or 64bit and which versions.
When you start virtual system you should see in "Devices" menu (it is visible on windowed mode or slided from bottom when you move cursor there), shortcut is HostKey+D. Read the whole manual of installing guest additions.
With 2GB RAM it may be difficult to satisfy both systems. Check how many free RAM you have on both systems after starting virtual machine. You can view it by issuing command "free -m".
You have dual core CPU but it is 32 or 64bit and your systems are 32 or 64 bit?
The information about your processor is not sufficient for us to help you. Please post the output of
If you have a 32 bit dual-core CPU (most like a Core Duo or Pentium D) then you most likely do not have hardware support for virtualization. That would be the cause for slow running VMs, but as said above, we need more information.