1. **State the problem:** You invested 4000 in an account that decreases each year. After 1 year, the amount is 3920, and after 2 years, it is 3841.60. We need to find the decay factor. 2. **Formula used:** The amount after $n$ years with decay factor $r$ is given by $$A_n = A_0 \times r^n$$ where $A_0$ is the initial amount. 3. **Apply the formula for year 1:** $$3920 = 4000 \times r^1$$ 4. **Solve for $r$ after year 1:** $$r = \frac{3920}{4000} = 0.98$$ 5. **Check with year 2 data:** Using $r=0.98$, calculate amount after 2 years: $$A_2 = 4000 \times (0.98)^2 = 4000 \times 0.9604 = 3841.6$$ 6. **Verification:** The calculated amount matches the given amount after 2 years, confirming the decay factor. **Final answer:** The decay factor is **$0.98$**.