(a)Will the future value be larger or smaller if we compound an initial amount more often than annuallyfor example, every 6 months, or semiannually holding the stated interest rate constant? Explain your answer.

(b-1)What is the future value of $1,200 after four years under 7.5% semiannual compounding?

(b-2) What is the effective annual rate for 7.5% interest with semiannual compounding? Be sure to show your EAR answer to 2 decimals, that is xx.xx%