The exit pupil of a scope is the diameter of the light bundle from a pinpoint object coming out of the eyepiece when the focal point of eyepiece and of the primary mirror are coincident. (i.e. occupy the same location)
The diameter of the exit pupil can be calculated by the following formula:
The exit pupil should not be larger than the diameter of the pupil of the dark adapted eye. If the exit pupil would be bigger, then the light that doesn't enter the eye would be wasted, i.e. you would not utilize the whole area of the primary. For young people, the pupil can get as big as 6 mm. For older people up to 5 mm. Under optimal conditions (and with near perfect optics) the smallest usable exit pupil can be down to 0.5 mm. The usable exit pupil range is thus from 6 - 0.5 mm.
If we introduce the usable exit pupil into the above formula, we find that the usable magnification range for a given aperture is 1/6th to 2 times the diameter in mm, or 4-50 times the diameter in inches.
Note: You can of course use a larger exit pupil for specific purposes, for example a larger true FOV for finding objects. However you then accept severe vignetting (i.e. light loss). Another effect is caused by the central obstruction (secondary). The obstruction percentage also give the size of the obstruction in the exit pupil. A 20 mm exit pupil and an obstruction of 20% has an not-illuminated center of 4 mm.
Some observers don't like the abrupt vignetting that occurs when the exit pupil matches the eye-opening. When the exit pupil is equal to the eye-opening, then a very small movement of the head causes an immediate vignetting to occur. This can be prevented by making the exit pupil slightly larger or smaller than the eye-opening.