Hey, the 8086 has 20 bit memory bus, so it can theoretically support full 1 MB of memory. However, as much as I know, 8086 chips never had complete 1 MB,they had at the most 256/512 KB of memory, and rest address space was used instead as memory mapped IO, or to interface with other chips.

When designing this, we never intended to have support for external chips, so instead we designed this to have the full 1 MB of memory.

Hope this helps!

Because segment B800h is also RAM here :)

It's not a PC emulator (or even x86 really, it just interprets the mnemonics you write instead of actual machine code).

You are, on a 8086 the address width is 20 bits, hence the 1 Mo limit.

https://en.wikipedia.org/wiki/X86_memory_segmentation