Below is a table matching bit depth to modes. There are two modes for 8-bit images, indexed and gray scale. Indexed images use 256 colors while gray scale images use 256 different shades of gray. CMYK is similar to RGB, but uses 8-bit numbers for the cyan, magenta, yellow, and black pixels. CMYK is for use by images that will be printed.
Compression refers to the method of reducing information in an image to make a smaller file size.
The two major categories of compression for graphics are lossless and lossy, which refer to the loss of image information. Lossy compression like JPEG loses image information. Layer is a term used in image formats such as Photoshop. Each layer of an image can be manipulated and edited without affecting other layers. Layers can be ordered so that one can be superimposed over another.