Final answer:
No, the competition between Boeing and Airbus is not an example of perfect competition because there are only two dominant firms in the market, which is a characteristic of an oligopolistic market, not perfect competition.
Step-by-step explanation:
The competition between Boeing and Airbus with respect to large passenger airplanes does not constitute perfect competition. Instead, it exemplifies an oligopolistic market, specifically a duopoly, where only a small number of firms dominate the market. In the context of perfect competition, we would expect many small firms, homogenous products, no significant barriers to entry, and transparency in terms of pricing and technology. However, the aircraft market is characterized by high barriers to entry, mainly due to the immense cost of developing new airplanes and the economies of scale required to produce them at a profitable price.
The correct answer to the question is: No, it is not a perfect competition because there are only two dominant firms in the market. Perfect competition is marked by the presence of many small firms, which is clearly not the case between Boeing and Airbus. Additionally, the products, though similar, can exhibit differentiation in terms of technology, design, and features, further moving away from the homogeneity of products assumed in a perfectly competitive market.