The Archive Utility in OS X is great but accepts no parameters, so it’s impossible to open a password protected zip file with it. When you double click on it it says “Unable to unarchive ‘name of file.zip’ into ‘directory’. (Error 1 – Operation not permitted.) In Safari, the download will say “Decompression failed”.
Instead, open up terminal (Applications > Utilities > Terminal) and cd to the directory the zip file is in, such as:
unzip -P [password] nameoffile.zip
where nameoffile.zip is the zip file and [password] is your password.
Then you can launch the file with open nameofunzippedfile.app, or run
to open the current folder in the finder to double click on your unzipped file.
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