Chester has a good tip, you can use the options in the Status Bar at the bottom of the Photoshop window. You can choose Effeciency, or you can choose Scratch Sizes.
The Scratch Sizes are basically the memory which Photoshop uses to perform tasks and temporarily store information. You can see this option by clicking on the right-pointed triangle in the status bar and selecting Scratch Sizes from the pop-up menu. If you don't see it, go to Window > Show Status Bar.
Once Photoshop uses up the computer's Ramdom Acces Memory, it begins to write to the hard disks as a form of virtual memory. Information from the hard disks cannot be accessed as quickly as from RAM so once this happens, things begin to slow down considerably (your computer will be making much more noise each time you perform a command).
If the Scratch Size number on the left is larger than the one on the right, Photoshop is writing to your hard disks. If you choose the Efficiency display, you'll see a percentage of how well Photoshop's memory resources are running. Since the example right is using almost double the amount of memory available, the program is only running at 65% of its best performance.
It is generally recommended to have 3 to 5 times the size of your common image size allocated in RAM to Photoshop. You might rather keep it a bit above or below this, depending on how much RAM is in your computer. If you're working on a 5 MB image, that means you better have at least 25 MB (megabytes) of memory available to Photoshop.