For the first digit you are choosing from 2 digits for the second digit you are choosing from 2 digits for the third digit you are choosing from 2 digits 2*2*2=8 111 110 011 101 000 001 100 010 However...... A number doesn't usually start with a 0 or 0s. Therefore, if you want 3-digit numbers and not just permutations using 0 and 1, then you must eliminate 011, 000, 001, and 010 Seeing that the first digit can't be 0, you choose from 1, then 2, and then 2 digits again; 1*2*2=4 numbers You choose which answer best suits your problem.