Images displayed on the web (including Moodle) should have as small a file size as possible, while still maintaining adequate quality. Don't use the image resize handles in text editors, as this is just the same large file shown in a smaller format. You should resize files before uploading them to use online.
Many students these days access Moodle on their mobile devices and in some cases they will be paying for every mega byte of data they download.
Keeping image file sizes small means pages will load more quickly and it will consume less data.
In order to do this a few rules can be followed:
Instructions with images can be downloaded here: http://alums.vassar.edu/images/volunteer/image-reductions-in-preview.pdf