To solve this expression, we need to follow the order of operations (PEMDAS/BODMAS).

First, we need to simplify the exponent:
(-1/2)^2 = (-1/2) * (-1/2) = 1/4

Next, we can substitute the simplified exponent back into the expression:
2 1/2 - 1/4 + 3/4

To add or subtract fractions, we need a common denominator. In this case, the common denominator is 4.

Converting 2 1/2 to an improper fraction:
2 1/2 = (2 * 2 + 1)/2 = 5/2

Now, we can rewrite the expression with a common denominator:
5/2 - 1/4 + 3/4

To add or subtract fractions, the denominators must be the same. Since the denominators are already the same, we can proceed with the addition/subtraction:
(5/2) - (1/4) + (3/4) = (5/2) + (3/4) - (1/4)

Now, we can add the numerators:
(5 + 3)/2 - 1/4 = 8/2 - 1/4

Simplifying the numerator:
8/2 = 4

Now, we can rewrite the expression:
4 - 1/4

To subtract fractions, we need a common denominator. In this case, the common denominator is 4.

Converting 4 to a fraction with a denominator of 4:
4 = 4/1

Now, we can rewrite the expression with a common denominator:
4/1 - 1/4

Subtracting the fractions:
(4/1) - (1/4) = (16/4) - (1/4)

Now, we can subtract the numerators:
16/4 - 1/4 = 15/4

Therefore, the simplified expression is 15/4.