1. **State the problem:** You have a mortgage with an annual interest rate of 2.5% and you make 12 payments per year. You need to find the periodic interest rate per payment period. 2. **Formula and explanation:** The periodic interest rate is the annual interest rate divided by the number of payment periods per year. 3. **Calculate the periodic rate:** $$\text{Periodic rate} = \frac{\text{Annual rate}}{\text{Number of payments per year}} = \frac{2.5\%}{12}$$ 4. **Perform the division:** $$\frac{2.5}{12} = 0.2083333\ldots\%$$ 5. **Round to four decimal places:** $$0.2083\%$$ **Final answer:** The periodic interest rate to use for mortgage payment calculations is **0.2083%** per payment period.