Calculate the periodic interest rate (per month) corresponding to a nominal annual rate of 9.5% compounded monthly.

Introduction / Context:
This problem is a straightforward conversion from a nominal annual rate to a monthly periodic rate. Understanding this conversion is vital when dealing with loans or investments that specify an APR but charge or credit interest monthly.

Given Data / Assumptions:

• Nominal annual interest rate = 9.5% per year.
• Compounding frequency = monthly (12 times per year).
• We need the interest rate per month.

Concept / Approach:
The periodic rate i for a nominal annual rate r_nom compounded m times per year is:
i = r_nom / m with r_nom expressed as a percentage. Here m = 12 because interest is compounded monthly.

Step-by-Step Solution:
Step 1: Take the nominal rate r_nom = 9.5%. Step 2: Determine the number of periods per year, m = 12. Step 3: Compute i = 9.5% / 12. Step 4: i ≈ 0.7916% per month. So the account earns about 0.7916% interest each month.

Verification / Alternative Check:
Multiplying the periodic rate by 12 gives 0.7916% * 12 ≈ 9.5%, which matches the given nominal annual rate. This simple check confirms the correctness of the periodic rate.

Why Other Options Are Wrong:
Option B (0.8916%) and option C (0.9916%) would produce nominal annual rates higher than 9.5% when multiplied by 12.
Option D (0.6916%) or option E (0.5000%) would give annual nominal rates lower than 9.5% and so do not match the stated APR.

Common Pitfalls:
Some learners attempt to convert using division by 100 and 12 together incorrectly, or they confuse this with finding an effective annual rate. For questions that explicitly ask for a periodic rate from a nominal rate, a simple division by the number of periods is sufficient.

Final Answer:
The periodic interest rate is approximately 0.7916% per month.