First a little background...when the SQL Server services get installed, they have to have a security context that has sufficient permissions on the local server to do what it needs to do. Usually the person doing the installation has local administrator permissions on the server, but it is usually NOT recommended to use that login as the services account name...the permissions are too elevated and if the password gets out it could compromise the security of your data.
In some cases, you can simply use the system-generated security context. This doesn't require a password to be entered, and is never actually used by a person to log in...it is only used by the SQL Server service.
Some installations use a separately created "user" account on the local machine so they have the ability to elevate permissions depending on what the SQL Server is for. It also allows the administrator to rotate the password on a periodic basis.
Some installations use a domain account so that multiple servers can use the same account for all their SQL Servers. It allows for simpler central management and administration of the entire SQL Server landscape.
So, long story short, if you are asked for an Account Name and Password, you should either use the Local System Account setting, or you should set up a new account either on the local server or in the domain (named whatever you want to name it...hopefully something meaningful) and use that.