Final answer:
QPIP premiums can be calculated using a percentage of gross earnings or a fixed monthly amount. These methods are akin to how small changes in compound interest and growth rates can significantly impact income over time.
Step-by-step explanation:
The question pertains to the calculation of premiums for Quebec Parental Insurance Plan (QPIP), which can be computed using various methods. The methods mentioned are:
- Percentage of gross earnings: This method involves calculating the premium as a percentage of the employee's total gross earnings.
- Flat rate per hour: This method calculates the premium based on a fixed amount for each hour worked.
- Fixed monthly amount: The premium is determined as a set amount each month, regardless of earnings or hours worked.
However, according to the options provided, the correct methods for QPIP premium calculations are percentage of gross earnings and fixed monthly amount. It is worth noting that the application of compound interest and compound growth rates is similar to how productivity rates affect income. Just like small changes in these rates can significantly influence income over time, small variations in QPIP premium rates can also lead to substantial differences in the cost to both the employee and employer over time.