Peter,
I assume you have come by this spectroscope without any real information on its design, rather than building it yourself, and you don't have a copy of the technical specifications? If you have the make and model, you can probably find a technical manual / specification on-line somewhere.
You probably need to consult a basic spectroscopy reference book to understand the working of your device. There is a wealth of information available - Ken M Harrison (aka merlin66 in the IIS forums) has written several excellent and affordable books for amateur spectroscopy, and the links that bojan provided in his first response will also provide great information.
In principle, your instrument takes a beam of incoming light, and reflects it off a grating with numerous very closely spaced lines, such that it spreads into a spectrum. The "dispersion" is the angular width of the spectrum - the finer the lines on your grating, the greater the dispersion (i.e. the wider wider the angle), and the finer the detail you can resolve, but you may only be able to examine a part of the spectrum at any time, if the whole spectrum is wider than your camera sensor. (My Star Analyser 100 grating allows the whole spectrum to be captured in a single frame, but cannot show as much detail as your type of instrument.)
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