Question 868697
I understand the problem as:


Jose borrows $400 from his brother to fix his car. His brother doesn't like lending Jose money and so charges him 3% interest per month.
Write a rule in the "y=..." form that will give the amount of money, y, Jose will owe his brother after n months, assuming that he doesn't make any payments.


The answer depends on whether this is simple interest or compound interest.


If it is simple interest, then the answer will be:


y = $400 + $400 * .03*n


It's the same formula you used only you forgot to include the principal that has to be repaid.


If he is charging you compound interest, then you will be paying interest on the interest that has accrued and you will owe more at the end.


In the compound interest case, the formula will be y = $400 * (1.03)^n.