1. **State the problem:** We need to find the decay factor for an account that decreases by 1.8% each year. 2. **Formula and explanation:** The decay factor is calculated as $1 - r$ where $r$ is the rate of decrease expressed as a decimal. 3. **Convert percentage to decimal:** $1.8\% = \frac{1.8}{100} = 0.018$ 4. **Calculate decay factor:** $$ \text{decay factor} = 1 - 0.018 = 0.982 $$ 5. **Interpretation:** This means the account retains 98.2% of its value each year after the decrease. **Final answer:** The decay factor is $0.982$.