Q.How many four digit numbers will not exceed 7432 if they are formed using the digits 2,3,4,7 without repetition?

The Fundamental Principle of Counting is the basic toolkit for counting outcomes without listing them one by one, and it has two complementary halves. The Addition Principle applies when a single choice is made from among several mutually exclusive alternatives: if one operation can be carried out in $m$ ways and a second, entirely separate operation can be carried out in $n$ ways, and only ONE of the two operations is actually performed, then the total number of ways is $m+n$. The word 'or' in a problem is the usual signal for this — choosing a drink that is EITHER a fruit juice OR a milkshake. The Multiplication Principle applies when two (or more) operations are carried out one after another, in sequence, as part of the SAME overall task: if the first can be done in $m$ ways and, independently of that choice, the second can be done in $n$ ways, then together they can be done in $m\times n$ ways. The word 'and' is the usual signal — choosing a shirt AND a matching pair of trousers. Both principles extend naturally from two activities to any finite number of activities, simply by adding …