We have 128 teams.
In each round, half of the teams remain, so if T is the number of teams and n is the number of rounds, we have:
and we start with n=0 so T(0)=128.
Then, we can use this recursive expression to find T after four rounds (n=4), but it is better if we derive an explicit formula for T in function of n (and not in function of the past terms of the sequence):
With the last expression we can calculate T for any value of n. Then, for n=4, we have:
NOTE: in this case, its better to express the factor 0.5 as a fraction instead of a decimal.
Answer: after 4 rounds there will be 8 teams left.