I think this is best illustrated with a simple example.
Suppose you have a set of 4 objects: $\{ A,B,C,D \}$
The question is: how many possible combinations of objects are there? Some possible combinations are: $AB$, $ABD$, $BCD$.
Note that the order does not matter when it comes to combinations so $AB$ would be the same as $BA$. One useful way to think about this then is in terms of sets, for sets have no order. So, $AB$ can be thought of as $\{ A, B \}$.
Also note that taking any of the objects is a possible combination as well, and this would correspond to the empty set $\emptyset$
OK, but how many possible combinations are there (or, in terms of sets: how many subsets of $\{ A,B,C,D \}$ are there?
OK, so the theorem says that this is $2^n$ with $n$ the number of objects in the original set, and in this example we have $n=4$ so there should be $2^4=16$ combinations. Now, you can try to find them all, and presumbaly you can find all $16$. OK, but why does this hold true in general? Well, think about how you could systematically generate all combinations.
First of all, take the first object $A$. We can put $A$ in any combination or not. OK, so lets's consider $\{ A \}$ and $\emptyset$ as temporary results or 'partial combinations'.
Now let's consider the next object $B$. Well, to each of the partial combinations we can either add $B$ or not.
So, the partial combination $\{ A \}$ gives rise to (add $B$) $\{ A ,B \}$ and (don't add $B$) $\{ A \}$.
Likewise, the partial combination $\emptyset$ gives rise to (add $B$) $\{ B \} $ and (don't add $B$) $\emptyset$.
OK, so now we have $4$ partial combinations: $\{ A ,B \}$, $\{ A \}$, $\{ B \} $, and $\emptyset$.
On to the next element $C$.
Again, we can add or not add $C$ to any of the partial combinations, and s0 each partial combination gives rise to two new partial combinations. So, the number of partial combinations doubles once again: $2 \times 4 = 8$.
And finally, with $D$ it doubles once again: $2 \times 8 = 16$
.... and I think you should see the pattern now ....