Joint default range

MediumProbability Finance & Derivatives~5m

Two bonds default with probabilities $P(A)=0.5$ and $P(B)=0.3$ . What is the maximum possible value of $P(A\text{ or }B\text{ defaults})$ ? (to 2 decimals)

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$P(A\cup B)$ grows as the overlap shrinks.
Minimum overlap here is 0.

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0.8 (± 0.01)

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Joint default range

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