163840 compounded annually for 2 years at 12.5% is 163840*1.125^2=207360.
163840 compound semiannually for 2 years at 6.25% (half-year rate) is 163840*1.0625^4=208802.50.
Therefore the gain after 2 years is 208802.50-207360=1442.50.
(This can also be calculated thus: 163840(1.0625^4-1.125^2)=163840*0.0088804.)