Compression ratio is the Maximum Cylinder Volume divided by the Minimum Cylinder Volume.
You generally get more power by raising the compression ratio, but you may need higher octane fuel. Raising it too high can cause decreased durability, holes in piston etc. You will notice most cars and motorcycles will have ratios ranging from 9:1 to 10:1.
The Minimum volume can be measured with the head off. A method that works well is using an acrylic disk that covers the entire combustion chamber (fitting exactly the same position as the cylinder), and has a small hole drilled in the middle. Unsing a syringe, fill the combustion chamber with water until it is full of water. Record how much water it took to fill it. Also, check the piston height in the cylinder at TDC. If it does not exactly come to the top of the cylinder, you will have to measure that volume and add it to the cylinder head volume. If it is a purely cyilindrical shape, you can calculate it using HEIGHT x PI x (D x D)/4. PI is 3.14159, D is diameter, height is the height of the cylinder you are calculating the volume of. Be careful if the piston is not flat, you may be better off measureing the volume than trying to calculate it. Also, valve clearance notches in the top of the piston also need to be added.
The Maximum cylinder volume is the the displacement added to the minimum. Displacement is STROKE x PI x (D x D)/4.PI is 3.14159.
For those of you who flunked math, don't ever work with mixed units. Either do the whole thing in inches, or do the whole thing in cm. Also, the volume of water you measure using a syringe for the combustion volume is probaly cc's, or ml. You can find a conversion factor easily on the net. There are 25.4 milimeters per inch, 2.54 cm per inch, 10mm per cm. If you know that, you can easily convert a cubic centimeter (ml) to a cubic inch by dividing by 2.54^3.