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Model Limitations

Definition

Model limitations describe the inherent constraints or boundaries within which a theoretical or computational model accurately represents a real-world system or phenomenon. These restrictions arise from simplifying assumptions, incomplete data, or the specific scope of the model’s design. Recognizing these limitations is essential for interpreting a model’s outputs correctly and avoiding overgeneralization. In digital asset analysis, model limitations often relate to predictive accuracy or the applicability of a security proof under various conditions.