Its a temperature depedant resistor. its resistance in ohms varies depending on what temperature it sees.
The correct way to test one is to remove the connector to it and test the resistance of the sensor. It should read a nominal value (ie for your particular car it might be 100ohms @ 25 degrees) that you will need to look up in a service manual. You need to use the ohms (resistance) setting of your multimeter.
If the sender is screwed it will usually be open circuit (no reading at all) or short circuit (very low resistance, pnly a few ohms)
You will always see 5 volts when its running as thats the voltage coming from the ECU to the sensor.
Measuring the voltage between the battery and the back of the sensor is a meaningless reading BTW.
Cheers,
Matt