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Virtual servers are limited by the host-node that they exist on and in turn, their resources can only go so high before a limit is reached. While virtual does scale well, it is limited by the availability of resources on the host-node. On a host-node there are several virtual servers at the same time, so while your package may have set resources allocated you may sometimes experience issues although rare.
When using a Dedicated server, your resources are yours and yours alone. There is no sharing of resources such as what occurs on a virtual server. Dedicated servers can be constantly upgraded to larger allocations compared to a virtual server which allows for them continue improving.