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First, you need to install Octave (a program which is completely separate from, and not included with, Sage). Then you need to make sure that the Octave interpreter is in your $PATH. From there, Sage's interface to octave should work. See the manual for details on the interface.

To download and install Octave inside your virtual machine, use the browser in the virtual machine to visit the octave download page. There are linux binaries available there as well as the source code if you want to build octave yourself.