I recently bought an oven but it was just yesterday that I saw that the knob for the temperature does not indicate any temperature. Only hi and lo. How can I adjust the temperature correctly?
It sounds like you need to buy an oven thermometer. Put it on the same rack you'll be using for baking, and it will tell you what "hi," "lo," and in between (if available) settings really mean.
I completely agree that an oven thermometer is the way to go. In addition to telling you what your settings mean, it can help let you know if the oven is working properly. Once you've established a baseline comparison between the thermometer and the knob settings, move it to different sections of the oven, as well as different racks, and check to see if the reading stays the same. You may lose a degree or two by opening the door, so give it a few minutes.
I had a problem with various things taking longer to cook in certain parts of my oven. I bought a cheap thermometer, heated the oven to the proper temperature, then started placing the thermometer in a number of locations. It turned out that a part of the back section of the oven was twenty degrees cooler than the front! We were able to have it repaired, and things are now cooking evenly no matter where in the oven I put them!