Final answer:
Energy flows from the hotter iron to the cooler water until both reach thermal equilibrium, in accordance with the first law of thermodynamics.
Step-by-step explanation:
When a piece of iron at 356 K is placed in water at 298 K, energy flows from iron to water. This occurs because heat always transfers from an object with a higher temperature to an object with a lower temperature until thermal equilibrium is reached. This process obeys the first law of thermodynamics, which states that energy is conserved in an isolated system. Thus, the energy that leaves the iron is gained by the water, and no energy is lost in the process, only transferred.