Neutral Gray is half way between white and black. It is the same color in real life or in a positive as it is on a negative. Thus it should look the same on our film as it does on our print or in our studio. It is used to calibrate meters and film processors. White reflects back almost all of the light that hits it while black reflects back little to none of the light that hits it.
Light meters measure the quantity of light in our scene.
There are two ways the light can be measured. One way is to measure the amount of light that reflects back from our subject. This is called reflected light metering and is what is in our camera system. The other type of measurement reads the amount of light that falls on our subject by placing a meter up near the surface of the subject and recording the amount of light that strikes a white ball 1 inch in diameter. This is called Incident Meter reading and is considered most accurate.