Well, the graphic really says it all, but here's some explanatory text from the Sheldon Brown web site:

'All current three-speeds except for the Sturmey-Archer S3X fixed-gear hub have a wide range, with big steps between all of the gears. The way bicycle manufacturers commonly set up three-speeds, the middle gear is too low for level-ground riding, to keep the top gear from being completely useless. A 3-speed hub will serve you much better if you install a larger rear sprocket or smaller chainwheel, and use the top gear on level terrain. The low and middle gears are then better for acceleration and climbing. If you spin out on downhills, then you can coast.

Sheldon disparaged coasting, but really, occasional coasting is better than struggling up hills and having no level-ground gear! The top gear with a 3-speed should usually be in the range between 70 and 80 gear inches (5.6 and 6.4 meters development, 5.0 to 6.0 gain ratio), depending on your strength and pedaling style -- say, a 46-tooth chainring and 22-tooth sprocket with a 26-inch rear wheel. If the terrain where you ride is all up and down, with little or no level ground, you may want even lower gears than that.'