The actual resolution in ppi is what you save in the original program with the file, e.g. in Photoshop is an image saved with 72ppi.
When you place an image by clicking it comes in with the original size, actual resolution is the same as the effective resolution.
If you place an image by dragging or if you scale an image in InDesign the effective resolution changes. E.g. if you scale the 72ppi image to 25% (=1/4) you get an effective resolution of
72 × 4 ppi = 288ppi
If you scale an image unsymetric (x and y axis different scale factor) you get something like 288 ppi × 300ppi, in the control panel at the top of your screen you would see in the scaling fields different values when you select this image. To correct it, change the value there.
When you make your image physical smaller in InDesign, the resolution increases as the same information (Picture Elements, pixels) needs less room, so the information density increases.
So, to add on what Willi described, and to answer your question (as a rule-of thumb), have your images at 300ppi as the effective resolution in InDesign (this allows two pixels per line screen, which would be around 130 to 150 lpi for printing litho on coated stock).
Another way of looking at it: you can work out effective ppi by counting pixels and using a ruler.
Use the ruler to see the size on the FINAL printed page. Perhaps your picture measures 2 inches high by 3 inches wide on the paper. That's the effective size of the picture. Of course you don't need a ruler, but you need to understand that is what you are measuring.
Now, an image is so many pixels wide (and high, but let's just talk wide). Perhaps your image is 600 pixels wide.
So we have two figures
width in pixels = 600
effective width in inches = 3
What do we do with this? Divide the first figure by the second to get pixels per inch.
pixels per inch = width in pixels / effective width in inches = 600 / 3 = 200.
You can do the same for height; ideally you get the same answer but you won't always; use the lowest number.
Thank you! That is very helpful and I think I've got it figured out so I know what I'm looking at.
I've got several pix in my document that have an actual ppi of 72 with various effective ppi's. Would the best way to correct this would be to click on the picture in the links panel, go to "Edit with" and choose the Photoshops elements editor option and resize the images to 300 ppi? The pix are all different sizes in my document. Or do I need to go back to the original, resize and then replace with the low res pix in my document?
To avoid this in the future is the best idea to resize the pix to 300 ppi before I place it in ID?
You cannot increase effective ppi in any useful way. Yes, you could go into Photoshop but you can't put back in detail that was never there, or was lost when you reduced ppi. So you have to go back to the original; the pixel size of the original decides the maximum size you can print at. (This is why cameras are being made with more and more megapixels, so we can print bigger).
Having the images oversize does no harm except big file sizes. This may still be a lot of harm, and some printers will reject it just because needlessly huge files clog up their systems.
Don't forget, if you resize before placing, you need to resize for the effective ppi. One way to do this is first change the size in inches/mm without resampling; this will tell you the effective ppi. You can now decide if it isn't enough (rethink the design), or if it is too large (resize without changing dimensions, with resampling).