Changing compounding frequency Using annual, semiannual, and quarterly compounding periods, (1) calculate the future value if $7,000 is deposited initially at 8% annual interest for 8 years, and (2) determine the effective annual rate (EAR). Annual Compounding (1) The future value, FV, is SL (Round to the nearest cent.) (2) If the 8% annual nominal rate is compounded annually, the EAR is %. (Round to two decimal places.) Semiannual Compounding (1) The future value, FV, is SC (Round to the nearest cent.) (2) If the 8% annual nominal rate is compounded semiannually, the EAR is %. (Round to two decimal places.) Quarterly Compounding (1) The future value, FV,, is $ (Round to the nearest cent.) (2) If the 8% annual nominal rate is compounded quarterly, the EAR is %. (Round to two decimal places.)