2 cost 25 cents; 16 cost half a dollar; I want to buy 256; what are they?

The answer is that the items referred to are the numbers (usually made
of metal) that you nail on the front of your house, the kind that you
buy at a hardware store.

We already know that a '2' costs 25 cents (a single digit), and a '16'
costs half a dollar, or 50 cents (because the number 16 has two
digits). So if your house's address is 256, you will have to buy three
items: a 2, a 5, and a 6. The price of any three-digit purchase of
house numbers would be 75 cents.

http://www.mortalwombat.com/Special/housenumbers.jpg

If anything is unclear, please request clarification; I'll gladly
offer further assistance before you rate my answer.

Best regards,
pinkfreud

Well done and concise answer.  Thank you and congrats on not taking
the bait (as I did) and went down the exponent relationship path -
nice trap on this version.

Glenn

Well, it could be that, but the numbers are all powers of 2, so I
wonder if that's what the problem is trying to hint at. You could
almost come it with anything as an answer that fits though. With the
powers of 2, I would guess that the items being bought are bits (in
other words, binary digits). Lets look at the binary representation of
the numbers:
2   =         10   (2 bits)
16  =      10000   (5 bits)
256 =  100000000   (9 bits)
The number 2, which is 2 bits, cost 25 cents. The number 16 is 5 bits,
which it says cost 50 cents, so I guess you get a deal if you buy 5.
So to get the 9 bits for 256, you'd pay 50 cents for 5 bits + 25 cents
for 2 bits + 25 cents for 2 bits = $1.00.

And "two bits" = 25 cents.

Apteryx

Pinkfreud's "house numbers" solution is indeed the correct answer.

This is actually a fairly common riddle. Variations appear on multiple web pages:
://www.google.com/search?hl=en&lr=&ie=ISO-8859-1&q=%22riddle+OR+teaser%22+%22house+numbers%22++%22cents+OR+dollars%22+&btnG=Search

And in these books (search inside for "cents"):
Crowd Breakers & Mixers
http://www.amazon.com/exec/obidos/tg/detail/-/0310220378/
Brain Teasers And Mind Benders
http://www.amazon.com/exec/obidos/tg/detail/-/0671761994/

Excellent work, Pinkfreud!