Note P to IBM€™s 2008 financial statements describes how taxes affect IBM€™s operations. Among the information given is the following (amounts in millions of U.S. dollars):

The continuing operations provision for income taxes by geographic operations is as follows:

1. a. Compute the effective tax rate (income taxes/earnings before income taxes) for both U.S. and non-U.S. operations for 2006, 2007, and 2008.
b. For each year 2006€“2008, compute the percentage of the total tax burden that was made up of income taxes.
2. A deferred tax asset is a tax deduction that has already occurred and has been reported as a financial accounting expense but cannot be used to reduce income taxes until a future year. As of December 31, 2008, IBM reports that it has a deferred tax asset of $5.215 billion related to retirement-related benefits. How would such a deferred tax assetarise?

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For the year ended December 31: 2008 2007 2006 Income from continuing operations before income taxes S 8,424 S 7,667 S 7,277 U.S. operations Non-U.S. operations 8,291 6,822 $16,715 $14,489 $13,317 Total income from continuing operations before income taxes For the year ended December 31: 2008 2007 2006 U.S. operations Non-U.S. operations Total continuing Provision for social security, real estate, personal property, S2,348 2,280 $2,413 2,033 1,791,488 S4,381 4,071 S3,901 provision for income taxes and other taxes S4,076 3,832 S3,461