Check your system profiler (Apple icon in menubar > About this mac > more information). The RAM tab should tell you how the RAM is installed. Most probably, it is 1GB x 2 sticks which will fill up your two available slots on the iMac. So if you want to make it 3GB, you have to remove 1GB from there, and put in a 2GB DIMM to make it a total of 3GB.
Although, you will be sacrificing on Dual Channel mode by doing that (improves performance in many cases). It is best to use RAM in pairs.
Its better to choose the 2.4GHz, upgrade just the CPU and hard drive and then buy 4GB of RAM somewhere else. You'll end up paying the same and getting 2 more GB of RAM.
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