Randomly thought about this in bio class today, did some quick work. Is this identity known and does it have any applications?
Let $\text{am}(a,b)$ denote the arithmetic mean of two numbers.
Let $\text{gm}(a,b)$ denote the geometric mean of two numbers.
Consider two arbitrary numbers $x$ and $y$.
Lemma: $\text{am}(\text{am}(x,y),\text{gm}(x,y))=[\text{am}(\sqrt x,\sqrt y)]^2$
Proof:
We have the following two identities:
$\text{am}(x,y)=\frac{x+y}{2}$
$\text{gm}(x,y)=\sqrt{xy}$
$$\implies\text{am}\left(\frac{x+y}{2},\sqrt{xy}\right)=[\text{am}(\sqrt x,\sqrt y)]^2$$
$$\implies\frac{\frac{x+y}{2}+\sqrt{xy}}{2}=\left[\frac{\sqrt x+\sqrt y}{2}\right]^2$$
$$\implies\frac{x+y+2\sqrt{xy}}{4}=\frac{x+y+2\sqrt{xy}}{4}$$
This completes the proof.