It's pretty straightforward. Here is the beginning explanation, and if you get interested and research it more you can get your Ph. D. in just photopaper.
Before the advent of Variable Grade (or Variable Contrast) papers manufacturers would control the contrast index of the paper by different manufacturing techniques.
Grade 1 is a low contrast paper, and is suitable for most printing with a high contrast negative. I.e., if the negative darks are very dark and the lights are very light, but that's not how the 'real' scene looks in the world, using a low contrast paper will make the print look more like reality.
Grade 2 is "normal" contrast (but that statement is loaded with controversy) for use with normal contrast negatives.
Grade 3 is higher contrast, Grade 4 still higher contrast, and Grade 5 the highest contrast for progressively lower contrast negatives.
All of this is assuming that you print for times that produce a reasonable image. Obviously if you click the enlarger on and then finish a cup of coffee, even on Grade 1 low contrast paper you’re going to get a black image.
So far as I know there was no grading "standard" around, so one manufacturer's grade 2 might print equivalent to another's grade 3. But since you probably didn't have much of a choice you learned to print with what was available.
Then along came variable grade paper. You can change the contrast ratio of how the paper behaves by varying the mix of green and blue light using yellow and magenta filters. So a box of VG/VC paper can often be used in place of grade 00 through grade 5+.
Starting out, if your negatives "look pretty good" then use grade 2. And if you have VG/VC paper start with the number 2 filter until you start to get the hang of it.
It's not magic, but it does take some practice. Nobody learns anything by getting it right the first time. You have to be willing to throw away a few pieces of paper to figure it out. But it is easy enough to learn.
