  The Microwave SQUID Multiplexer ({\mu}MUX) is the device of choice for the
readout of a large number of Low-Temperature Detectors in a wide variety of
experiments within the fields of astronomy and particle physics. While it
offers large multiplexing factors, the system noise performance is highly
dependent on the cold and warm-readout electronic systems used to read it out,
as well as the demodulation domain and parameters chosen. In order to
understand the impact of the readout systems in the overall noise performance,
first we extended the available {\mu}MUX simulation frameworks including
additive and multiplicative noise sources in the probing tones (i.e. phase and
amplitude noise), along with the capability of demodulating the scientific
data, either in resonator's phase or amplitude. Then, considering the additive
noise as a dominant noise source, the optimum readout parameters to achieve
minimum system noise were found for both open-loop and flux-ramp demodulation
schemes in the aforementioned domains. Later, we evaluated the system noise
sensitivity to multiplicative noise sources under the optimum readout
parameters. Finally, as a case study, we evaluated the optimal demodulation
domain and expected system noise level for a typical Software-Defined Radio
(SDR) readout system. This work leads to an improved system performance
prediction and noise engineering based on the available readout electronics and
selected demodulation domain.
