Hold it where you can rotate the sprocket clockwise and pull the shift/indicator chain all the way out and hold it out and notice if the hub turns slower than the sprocket when it is turned. When the indicator chain is held all the way out, it is in 1st. gear. Let the indicator chain move inward a little and notice if the hub turns about the same speed as the sprocket. That is second gear. Fully release the indicator chain and see if the hub turns faster than the rotation of the sprocket. That is 3rd gear. The hub should rotate freely in any gear and you should hear the clicking of the ratchet pawls inside the hub when it free wheels.