Suppose, as an example, that I have a VM for which I have assigned (in Settings) a single socket and 2 cores. It is the only VM running on the host (which has two physical sockets each with 8 physical cores). Is this VM able to utilize all the CPU power available, or will it be limited to whatever can be provided by 2 of the cores (6.2ghz/4 threads), leaving 14 cores essentially idle?
No, the VM will not be able to use all the CPU power available it will be limited to 2 cores.