First \(y_1=1+0.1(-2)=0.8\), then \(y_2=0.8+0.1(-1.6)=0.64\). The value \(0.72\) comes from computing the second slope with \(y_0\), and \(0.6\) from subtracting \(0.2\) only once.
Euler's method approximates the solution of an initial value problem \(y'=f(t,y)\), \(y(t_0)=y_0\), advancing in steps of size \(h\) using the slope at the current point.