The output impedance of the signal source (here 1KOhm) and the input impedance of the receiving circuit creates a voltage divider which attenuates the signal level.
Vresult = Vsignal*Rin/(Rin+Rout)
If the switch is in the upper position, the input impedance is 10KOhm, the resulting signal level: 10/11=0.09 -> 90.9% of the original level.
If the switch is in the lower position, the input impedance is 1KOhm (10 times bigger than the previous case), the resulting signal level is: 1/(1+1) = 0.5 -> 50% of the original signal.
The rule of thumb is, that the input impedance should be at least about ten times greater than the output impedance in order to preserve the original signal (AoE 2.2.3/A. Impedances of sources and loads)
