DSO/Scope sig monitoring is the ideal way, but for the simple DIY , here is some Basic info to help get around the lack of a scope, while still getting decent test results :

For simplicity, I will use your wiring as the example.

The grn wire is the input signal to the ECU..The Blk wire is the 02 output wire. So, if you leave them plugged into one another at that connector, the ECU responds to the 02 readings.... and if you splice onto that connection, your meter will show a variable voltage as the engine responds to the 02 reading..as the reading goes lean, the ECU corrects rich, and as the reading richens , the ECU corrects lean..
Rich/lean..Rich/lean..at about 1-2 times a second. By constantly changing from rich to lean in this short time frame , the engines a/f mixture is controlled at a mean value. This is where the scope would show a nice wave pattern. [ volts/time]

Now, with only a meter..... if you take that Blk wire off that connector, you can now read the 02 V. sig w/o the engine ECU in the circuit...this means there will be no rich/lean from the ECU b/c it now has no 02 input to respond to.
So , here is the trick...while looking at the 02 sig w/o ecu control, you can change the engines a/f mixture MANUALLY to see if the 02 responds to your manual inputs [ in other words, you are using the engine as a rich/lean a/f mixture generator, except you are the ECU]...so, with engine at idle and up to temp, you pull off a good sized vac line, causing your a/f mix to immediately go lean..02 should dop to a low V , showing it is resonding to your created lean condition.
[ A trick here is to hold your tumb over the created vac leak and open/close it with thumb and watch the meter..it should swing with your changes in inputs, and it should do it fairly fast..if NO, you have a bad or slow sensor.
Same goes for Rich test...there are several ways to enrichen the mix manually [ close off air intake at filter , or some use propane into a vac hose , or pull fuel reg hase off , causing higher pressure , etc]
As said by others ..google or search....

The bottom line is if you do not allow the 02 sens sig to feed back to the ECU for correction by unplugging it, you can manually change the input a/f mix it sees and your meter will clearly show if it responds to those a/f mix changes ..you are looking for a sens that has the capacity to rapidly change from a low V to a high V [ .1-.8 V are about decent for a good sensor..usually ], and one that will not change at all or very slowly..is suspect as NG.
This test is easier on 124s with HFM b/c you can enrichen by simply pulling the FP reg vac hose to do both rich/lean test.
If one does have a sensor that does in fact repsond to your inputs , but the ECU does not make the changes once you hook the grn wire back up, the problem is not the sensor, it is the Engine management not responding to the
sensors output.
... and allways check the 02 sens heater circuit..no/low 02 output can be caused by a bad heater bc they need to be hot to have ANY output ..[ closed loop will never happen with a cold 02 sens]

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A Dalton