The writing is confusing, but as I understand it 21 is about 20% of 104 (21x100/104). The same prosentage of 500 equals 100,96 and I would round it to 101 (the answer of the first equasion x 500/100).
So the number of ways of choosing two distinct letters at a time is (42)=6. We can then add the duplicate pairs which are O,O and N,N to give a total of 8 possible pairs.
