AWS Lambda's concurrency model does limit the number of function instances that can run simultaneously. By default, AWS imposes an account-wide concurrency limit, which affects how many instances of all your Lambda functions can run at the same time. However, you can set reserved concurrency limits at the individual function level, which allocates a portion of the account-level limit to a particular function. This question tests understanding of Lambda's concurrency controls, rather than its ability to scale, which is often misunderstood. The statement is true because it is possible to adjust the concurrency limit for each function, which offers control over scaling and ensures that critical functions have the necessary resources.