What is the significance of varying the number of shots while running a circuit in a quantum machine and qasm simulator?

When you perform one shot, the measurement at the end of the computation gives you one of the possible results. More shots produce a distribution.

In your simple example, you should get a uniform distribution over 00, 01, 10 and 11. You should notice that, with more shots, the distribution you get is more similar to the uniform one.