Final Answer:
The yearly maximum contribution to CPP (Canada Pension Plan) as of 2023 is option D. $6,500.
Step-by-step explanation:
The Canada Pension Plan (CPP) sets a limit on the maximum annual pensionable earnings, which determines the maximum contribution individuals need to make to the plan. In 2023, the maximum pensionable earnings are a significant factor in calculating the maximum CPP contribution.
The formula to calculate the yearly maximum contribution to CPP involves multiplying the contribution rate by the maximum pensionable earnings. As of 2023, the contribution rate is 5.70%, and the maximum pensionable earnings are $61,600.
The formula for the maximum CPP contribution is:
Maximum CPP Contribution = Maximum Pensionable Earnings × Contribution Rate
Substituting the values into the formula:
Maximum CPP Contribution = $61,600 × 5.70%
Calculating this gives:
Maximum CPP Contribution = $61,600 × 0.057 = $6,502.80
Since the CPP contribution is subject to rounding, the final yearly maximum contribution to CPP for 2023 is rounded to the nearest hundred, resulting in $6,500.
Therefore, the correct answer to the question regarding the yearly maximum contribution to CPP is D. $6,500, based on the defined maximum pensionable earnings and contribution rate for the specified year (option D).