Error: Could not access the Package Manager. Is the system running? - At Android Studio

First make sure you are running Android Studio version above 0.3.2 because there was some issue reported regarding the same in AS 0.3.2 . If it is not you can update it from Help >Check for update.

If you are already running AS above 0.3.2 :

Seems like issue is with your emulator not with Android Studio. It may happen that you are trying to install application before even the emulator started properly.

Wait till the home screen appears in the emulator before trying to install any application.

Also try to install any apk in Emulator from command line

Steps to install

• Go to $Android_SDK_DIR\platform-tools, right click there keepingshift key pressed and Chose "Open Command Window here".
• Run command adb devices to make sure yout emulator is runningproperly. It will show all your running emulators.
• Now if emulators are showing properly, type the command adb installYOUR_FULL_APK_PATH , YOUR_FULL_APK_PATH is of any .apk file path inyour system.

Please update if this works fine.

The most common cause of this error is simple: You have to manually unlock your Android Virtual Device by swiping the “lock” icon on the screen. Security measures prevent the emulator from letting you connect the debugger before doing this.

The problem is resolved:

In Android Studio

1. Start run/debug
2. if you see the message
3. Do not closed the AVD, just click on run/debug again, the Application will be running when you unlock the application.

The same problem but different solution, I modified my Virtual Device, I changed Memory option and Internal Storage, and it works fine.RAM:512 , VM HEap: 192, Internal Storage=200, SD Card Size: 200 for Device Nexus 4 android 4.2.2.