What is the percent error if students were expected to produce about 80.0g of MgO and the amount they measured after the reaction was 74.6g of MgO?

Percent error gives you an idea of how well you performed in the lab setting by comparing your data obtained from the lab to a value you calculated on paper.

If you calculate on paper that you should obtain a yield of 80.0 g MgO, this expected value is ideal (what you should produce in a perfect world with no error). So this 80.0 g is your expected yield. 

If you go in the lab to perform your experiment (and there is always error in the lab) and you actually get 74.6 g of MgO, this is your actual yield. 

In equation form: 

Percent error = [(expected yield - actual yield) / expected yield] x 100

Percent error = [(80.0 - 74.6) / 80.0 ] x 100 = 6.75%