I\'m installing MyApp on the iOS simulator (Xcode 7, iOS 9) using xcrun simctl install booted MyPath/MyApp.app.
This works as expected and
I encountered this problem in Xcode 6 when using the .app file in directory "Release-iphoneos" instead of "Release-iphonesimulator". There are multiple versions of this file, and you need to change the path in your install command to point to the correct one.
If this .app file was sent to you by someone/something else, it may be a copy from the wrong directory (not built for a simulator)