When checking sound preferences It shows the sound stuck on mute, it will not let you untoggle, I reset PRAM and it worked then a few days later same issue, PRAM worked every other time I tried but now it doesn't, it will go to a blank grey screen for a few seconds then to black for a few seconds then back to grey and this continues with it never advancing to the apple grey screen until I release the buttons then it continues booting up but no chime sounds. Any one have any ideas on anything else I can try my iMac is just 2yrs old I am sooo bummed. Any advice from any experienced maccers would be appreciated!
Next, is your two year old iMac still under AppleCare? If so, bring it in to an Apple Store and have them look at it.
What version of OS/X do you have? - Make sure you run all Software Updates available to you.
Have you tried reinstalling OS/X? - Do you have a Time Machine backup to restore from?
The behavior of the mute is certainly not right and I think it is software related. Although it could indicative of a hardware failure as noted in this MR thread: Mac Pro, volume stuck on mute.
Then there was another issue that seemed to be resolved using a headphones trick in this thread: Volume on permanent mute
