Step 1: Plan:
Think of the graph of $\ln(x^2+1)$.
Step 2: Steps:
The function $g(x) = \frac12\ln(1+x^2)$ is even with its minimum at $x = 0$. It falls for negative $x$ and rises for positive $x$, as $1+x^2$ shrinks towards $0$ and then grows.
So it is monotonically increasing on $(0,\infty)$, i.e. $R^+$.
Final Answer:
The function $g$ is increasing on $R^+$, option (A).
\[ \boxed{R^+} \]