Normally PSX processor runs x instructions per second. The hardware processor is faster, so after finishing emulating one instructions it needs to wait some time before it starts processing next instruction. You may shorten this waiting time, and have emulated processor running y times faster. This is the multiplier.

But, there is a BIG but... The emulator has many more things to emulate, like I/O and GPU and it usually takes place in the described "waiting" time. N900 does not have enough power to emulate it all with the current codebase, so you may compensate the lag using multiplier only to some extent.