How do you determine whether the situation is an example of an inverse or direct variation: Nicole earns $14 for babysitting 2 hours, and $21 for babysitting 3 hours?
It is direct variation.
Direct variation can always be written y = kx, where k is the constant of variation. In your example if y = 14 and x = 2 and y = 21 and x = 3 the constant of variation is k = 7.
For inverse variation
As a note. You can tell direct variation because both quantities move in the same direction .i.e increase or decrease. In inverse variation one increases as the other decreases.
Hope this answers your question.