Given a set S of cardinality [tex] n [/tex], the subsets containing at most 2 elements are:
There is clearly only one empty set, and there are [tex] n [/tex] subsets containing one element (you choose one of the n elements in S to create your subset)
Finally, the number of subsets containing two elements is
[tex] \displaystyle \binom{n}{2} = \dfrac{n!}{2!(n-2)!} = \dfrac{n(n-1)}{2} [/tex]
In fact, in general, the binomial coefficient [tex] \binom{n}{k} [/tex] represents the number of subset of cardinality k that you can build from a set with cardinality n.
So, if we update our list, we have the following subsets:
For a total of
[tex] 1+n+\dfrac{n(n-1)}{2} = \dfrac{n^2+n+2}{2} [/tex]
subsets with at most two elements.