We know the formula for the union of two events:
\[
P(A \cup B) = P(A) + P(B) - P(A \cap B)
\]
We are given:
- $P(\overline{A}) = 0.7$, so $P(A) = 1 - P(\overline{A}) = 1 - 0.7 = 0.3$
- $P(B) = 0.7$
- $P(B|A) = 0.5$
Now, to calculate $P(A \cap B)$, we use the definition of conditional probability:
\[
P(B|A) = \frac{P(A \cap B)}{P(A)}
\]
Substituting the values:
\[
0.5 = \frac{P(A \cap B)}{0.3}
\]
Thus,
\[
P(A \cap B) = 0.5 \times 0.3 = 0.15
\]
Now, substitute the values into the union formula:
\[
P(A \cup B) = 0.3 + 0.7 - 0.15 = 0.85
\]
Thus, $P(A \cup B) = 0.85$.