Here is a graph showing the luminescence of a glow-in-the-dark paint, measured in lumens, over a period of time, measured in hours. The luminescence of this glow-in-the-dark paint can be modeled by an exponential function.

Notice that the amounts are decreasing over time. The graph includes the point $(0, 12)$. This means that when the glow-in-the-dark paint started glowing, its glow measured 12 lumens. The point $(1, 6)$ tells us the glow measured 6 lumens 1 hour later. Between 3 and 4 hours after the glow-in-the-dark paint began to glow, the luminescence fell below 1 lumen.

We can use the graph to find out what fraction of luminescence stays each hour. Notice that $\frac{6}{12}=\frac{1}{2}$ and $\frac{3}{6}=\frac{1}{2}$. As each hour passes, the luminescence that stays is multiplied by a factor of $\frac{1}{2}$.

If $y$ is the luminescence, in lumens, and $t$ is time, in hours, then this situation is modeled by the equation:

$y=12 \boldcdot (\frac{1}{2})^t$

We can confirm that the data is changing exponentially because it is multiplied by the same value each time. When the growth factor is between 0 and 1, the quantity being multiplied decreases, the situation is sometimes called “exponential decay,” and the growth factor may be called a “decay factor.”