need explanation

Link popularity is a measure of the quantity and quality of other web sites that link to a specific site. It is an example of the move by search engines towards off-the-page-criteria to determine quality content.

Link exchange is the process of exchanging links between two relevant web sites.

Link popularity is one way of submitting you're link to the other sites while link exchange is just changing links with another website.

Link Exchange
This is the procedure by which one site agrees to link to another site in return for a link back from that site.

Link Popularity
Is the number of other websites that link to your site. Some Search Engines such as Google use this as a measure to help them rank your own site.