A simulation is basically a system which is made to behave same as the other as prescribed to its instructions. The process of implementation using this system is totally different as it allots the general behavior to a system, which does not essentially adhere to every rules of a system which is simulated. It lays down the procedure to the user describing about how a system functions.
For example, just think of some flight simulator. It generally looks and even feels as you are actually flying in an airplane, but in reality you are totally disconnected from it. You may bend or break those rules which seem harsh to tackle as nobody sees you. Likewise, it is done by flying an Airbus A380 model upside down between the destinations of London and Sydney without breaking it.
Emulation is a process of a system that imitates to the behavior or functioning of a computer or electronic system. It follows all the rules of the particular system that is being emulated. It works by replicating the functioning of the other system; ensuring that the binary function is compatible with the inputs and outputs of the emulated system. It operates although in a different environment against the environment of original emulated system. Here the rules are fixed and hence cannot be broken in any condition.
For example The MAME system is mainly built on this system. Thus, all the old arcade systems which were long forgotten, that were used to be implemented for almost all hardware, even the firmware of the hardware systems. These can now be emulated right down to their original bugs and crashes which may appear when a system reaches its highest possible score.
Reasons of Emulators used more as compared to simulators are given below: