A near accident comes to mind involving this was an examiner's call for a late go around. This was closely followed by a simulated engine failure in the middle of the go around.
Yes, there are idiots that up the ante in tests `because they can`.
The Australian CASA ATO manual states in several places that: "after a simulated failure, the prescribed ATO or prescribed person must ensure the aircraft is configured back to a normal operating mode before another simulated failure may be introduced except where the simulated failures are linked (e.g. electrical failure leading to a flapless approach and landing).