Yes you can use a multimeter to see if the sensor detects the magnet as it moves past the sensor.
Some sensors are pole sensitive in that they only work with the north pole or south pole of a magnet.
Since most hall effect sensors have a open collector output, you need them to be in a circuit to test.
A simple circuit with a LED indicator works quite well actually. But one could substitute a multimeter to watch the voltage level go up and down as the magnet moves by. You can test the hall effect sensor on the engine by connecting the multimeter to the ground and signal wires coming out of the sensor. Then moving the magnet past it should cause the voltage level seen on the multimeter to go up and down.