The question is related to permissions, between "Grades - edit" and "Grades - select final grade for moderation".
Moderation only comes into play for "moderated" assignments, which are assignments that are reviewed and graded by multiple reviewers. In that case, the teacher, with "moderation" permissions, selects what the final grade will be.
On the other hand, editing a grade is exactly what you would expect--you have permissions to change the grades in the grade book.
There are additional privileges associated with each permission, and you can find out more details (if you are an administrator) by going to Admin > Permissions and clicking on the name of the permission:
