Exercise 4

Verify for the Cobb-Douglas production function
\[P(L, K) = 1.01L^{0.75}K^{0.25}\]
discussed in Example 3 that the production will be doubled if both the amount of labor and the amount of capital are doubled. Determine whether this is also true for the general production function
\[P(L, K) = bL^rK^{1 - r}\]