Looks like a nice DWM Luger serial # 6881 l post WWI production. That loop below the number is an 'el' not 'eye' in lower German case. On the underside of the barrel are marks. If it is just the serial number, it is .30 caliber but if it has 8.82 then it is a 9mm parabellum. This forum has a pencil test to determine caliber.
http://forum.lugerforum.com/showthre...ghlight=pencil