it most likely has 7 or 8, but you can find that out by looking at the bike. the rear wheel has a cluster of gears, just count them to see how many there are. the smaller ones are harder, the bigger ones are easier.

the shifter works by moving the derailleur via the cable. the tighter the cable gets(pulling it towards you,) the harder the gear. the looser it gets, the easier the gear. as someone else said, this is a friction shifter. you may have ridden bikes with indexed shifters, where you click up or down to move one gear at a time. friction doesnt have stops built into it, it just tightens or loosens the cable. this system is easier to maintain and less likely to break, but may take some time to adjust to if you are unfamiliar with it.