I would have probably said (with some imprecision): Electrical circuits either carry a current (binary 1) or they don't (binary 0). [Ignoring the fact that you could also measure the AMOUNT of current carried here] Because of this underlying limitation in electrics you need to make do with just a binary system in computers.

Depending on the amount of time remaining I would either go into more depth or point him towards "Code: The Hidden Language of Computer Hardware and Software" by Charles Petzold (http://amzn.com/0735611319)