1. **State the problem:** We want to break down the expression $x^2 - 4$ into simpler parts multiplied together. 2. **What is difference of squares?** When you have something like $a^2 - b^2$, it means one square number minus another square number. 3. **Look at our expression:** $x^2$ is $x$ times $x$, and $4$ is $2$ times $2$. 4. **The special rule:** $a^2 - b^2$ can be written as $(a - b)(a + b)$. 5. **Use the rule here:** So, $x^2 - 4$ becomes $(x - 2)(x + 2)$. 6. **Why does this work?** Because when you multiply $(x - 2)(x + 2)$ back, you get $x^2 - 4$ again. 7. **Final answer:** $x^2 - 4 = (x - 2)(x + 2)$