Question 3.3 I didn't understand what the question has asked us to calculate I mean how do we calculate P[U(t)<0, for t=1 or 2]? And can we say that P[U(t)<0, for t=1 or 2] = P[U(1)<0 or U(2)<0] and the use law of addition i.e P(A or B)= P(A)+P(B)-P(A and B)?
The events are intermingled, ie one is conditional on the other. Best to use a tree diagram approach instead.
