What is a list query for a parameter?

I was reading the July summary of new features (https://powerbi.microsoft.com/en-us/blog/power-bi-desktop-july-feature-summary/) and near the bottom is a section for new query parameter features.

It indicates that the "Allowed Values" option can be set to Query and then select Query List from the Query drop-down list

My questions are 1) What is a query list

                            2) How do I create one

                            3) Why is the Query field drop down list on the parameters panel, not enabled.

I have the august update installed.

Any help would be greatly appreciated.

Thank you

Tracy