Step 1: Digits: 1, 4, 2,
1. Distinct permutations: Total permutations = $\frac{4!}{2!} = 12$ distinct numbers.
Step 2: Sum of all distinct numbers formed by digits where repetition exists: For each position, the sum of digits appearing in that position across all permutations can be found.
Step 3: Sum of all digits = 1+4+2+1 =
8. Each digit appears in each position equally often. Number of times each digit appears in a specific position = $\frac{\text{Total permutations} \times \text{frequency of digit}}{\text{total digits}} = \frac{12 \times f_d}{4}$.
Step 4: For digit 1: frequency = 2, so appearances per position = $\frac{12 \times 2}{4} = 6$.
For digit 2: frequency = 1, appearances = $\frac{12 \times 1}{4} = 3$.
For digit 4: frequency = 1, appearances = $\frac{12 \times 1}{4} = 3$.
Step 5: Sum in each position = $6 \times 1 + 3 \times 2 + 3 \times 4 = 6 + 6 + 12 = 24$.
Step 6: Total sum of all numbers = $24 \times (1000 + 100 + 10 + 1) = 24 \times 1111 = 26664$.
Step 7: Number of distinct numbers =
12. Mean = $\frac{26664}{12} = 2222$.
Step 8: Final Answer: The arithmetic mean is 2222.