Does the azure compute emulator try to simulate instance performance based on the vmsize specified in the service definition file?
The Azure emulator is a local (your computer) emulator of Windows Azure. It allows you to build and test logic of your application before Azure deployment.
The emulator will not reduce performance if you are testing small instance on a very powerful system. So sometimes single emulator instance can perform better in compute emulator than on Azure. However, real power of Azure comes with ability of scaling out your application (among other great features).
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