Resolution is to judge the quality of the measurement results of a watch. Knowing the resolution of a meter lets you know if you can see small changes in the signal being measured. For example, if the DMM has a resolution of 1mV over a 4V range, you can see a tiny change of 1mV (1/1000 of a volt) when measuring a 1V signal
If you're measuring less than 1/4 inch (or 1mm) in length, you're definitely not going to use a ruler with the smallest units in inches (or centimeters). If the temperature is 98.6 degree F, it's useless to measure with a thermometer that only has integer marks. You need a thermometer with a resolution of 0.1 degree F.
The number of digits and words are used to describe the resolution of the table. Multimeters are categorized by the number of digits and words they can display.
A 3-and-a-half-digit meter can display three full-digit digits from 0 to 9, and one half-digit (only 1 or no display). A 3½-digit digital meter can achieve a resolution of 1999 words. A 4½-digit digital meter can achieve a resolution of 19999 words.
The resolution of digital tables is better in words than in bits, and the resolution of 3½-digit tables has been increased to 3200 or 4000 words.
The 3200-word digital meter provides better resolution for some measurements. For example, a 1999 word meter, when measuring voltages greater than 200V, you can't display 0.1V. The 3200-character digital meter can still display 0.1V when measuring the voltage of 320V. When the measured voltage is higher than 320V and the resolution of 0.1V is to be achieved, an expensive 20,000-character digital meter should be used.