The alignment field controls where the image will be positioned in relation to the text content There are many choices as outlined below. If you aren´t sure - simply try a few and view the page - sometime some simple experimentation is the best way to get what you want:

Top Left Above the text - and to the left
Top Center Centered above the text
Top Right Above the text - and to the right

Left Wrap The image is placed on the left with text flowing around it (you will want to add some padding in this case)

Left Fixed Top To the left of the text (no text-flow) and if the text is longer then the image height aligned to the top of the text-block.
Left Fixed Middle To the left of the text (no text-flow) and if the text is longer then the image height aligned to the vertical center of the text-block.
Left Fixed Bottom To the left of the text (no text-flow) and if the text is longer then the image height aligned to the bottom of the text-block.

Right Wrap The image is placed on the right with text flowing around it (you will want to add some padding in this case)

Right Fixed Top To the right of the text (no text-flow) and if the text is longer then the image height aligned to the top of the text-block.
Right Fixed Middle To the right of the text (no text-flow) and if the text is longer then the image height aligned to the vertical center of the text-block.
Right Fixed Bottom To the right of the text (no text-flow) and if the text is longer then the image height aligned to the bottom of the text-block.

Bottom Left Below the text - and to the left
Bottom Center Centered below the text
Bottom Right Below the text - and to the right

Float Left Similar to Left Wrap this behaves the same way - with a technical distinction required for some advanced users.
Float Right Similar to Right Wrap this behaves the same way - with a technical distinction required for some advanced users.

Inline The image is placed omn the same line as the text content (useful only for small images.

Image Only Use this alignment if you are placing more then one image on a line and there will be no visible text content.