What effect does compounding interest more frequently than annually have on (a) Future value and (b) The

Question:

What effect does interest more frequently than annually have on
(a) and
(b) The effective annual rate (EAR)? Why?

Compounding
Compounding is the process in which an asset's earnings, from either capital gains or interest, are reinvested to generate additional earnings over time. This growth, calculated using exponential functions, occurs because the investment will... Future Value
Future value (FV) is the value of a current asset at a future date based on an assumed rate of growth. The future value (FV) is important to investors and financial planners as they use it to estimate how much an investment made today will be worth...