The Histogram Window doesn't do anything in and of itself, but rather is a a tool designed to help you decide what you need to do to improve your image. The histogram window displays a graph of the color values of the active window in RGB and luminance.
Full luminance is white while zero luminance is black.
The numbers at the top of the window display the number of pixels that match the histograms max., min., and average values. The spectrum for a color is on the horizontal axis while the portion of the image's color that matches that spectrum is displayed on the vertical axis. The check boxes at the bottom allow you to turn off the graphing of certain colors or the luminance. The Histogram Functions modify an image or a selection within that image based upon its luminance histogram. There are two Histogram Functions within Paint Shop Pro, the Equalize Function and the Stretch Function.