"Wayne, Here is the troublesh
"Wayne, Here is the troubleshooting procedure for that motor, courtesy of Clams Canino.
MERCURY BATTERY-POWERED CDI TEST
FOR DISTRIBUTOR MODELS
This test is for the 332-2986 switchbox used from 1967-1978 on all the inlines.
This test assumes your coil is good (most all are).
DISCONNCT BATTERY
1. Turn off ignion
2. Disconnect all 3 wires on the distributor side of the switchbox.
3. Remove the HV lead from the coil to the center cap (remember it unscrews
from cap)
4. Reconnect that HV center lead to the COIL side only.
5. Position that HV lead about about 3/8" from ground (block, shrouds etc)
and find a way to hold it there.
6. Jumber the brown and white terminals on the dist. side of the switchbox
together.
RECONNECT BATTERRY
7. Check that you have +12 V at red terminal.
8. Turn on ignition and verify +12V at white terminal (on red terminal side)
9. Touch the black terminal to ground - unit should cause spark each time
you touch ground.
If that passes and it won't fire at all, suspect the trigger
Here is the Link and Sync for that motor
Manual specs are different for each but this is close enough to get them all REAL close. This assumes nothing is broken or "wrong" with it. This also assumes that the timing pointer is properly adjusted (if adjustable) to accurately read TDC of the #1 piston.
This basic procedure will work for all the 2/3/4/6 cylinder inlines from 1960 to 1988. It's not for the newer 3 and 4 cylinder loopers.
Engine off
Disconnect throttle cable
Pull throttle arm to full throttle and verify carbs open fully. Adjust main throttle stop so that the carbs are JUST hitting thier own little throttle stops. The idea here is that you want the screw stop and NOT the carbs acting as the "final stop" for your throttle lever.
Return the throttle to idle, carbs should be closed. Set all idle screws to 2 1/4 turns out from lightly seated.
Remove all plugs except #1, hook a timing light to #1. Then follow the narritive.
When the throttle is in the idle position the carbs should be fully closed and the ignition retarded. It the amount of retardation that determines your idle speed and is set later with the idle stop screw.
Timing Event One - throttle pickup.
As the throttle is advanced, the spark timing advances toward TDC and then to before TDC. As the timing is just passing TDC the 1st (minor)throttle pickup should hit and start to open the carbs. Use the timing light. Adjust the tang or trigger screw to make this a reality. All of them are speced different, but if the 1st pickup hits at 3-4 degrees BTDC advance - you win. Use the timing light with a friend cranking it to complete this setting.
Timing Event Two - max advance.
As you continue to advance the throttle the timing will advance while the carbs slowly open a bit more. The next adjustment is max advance, this is the point where the distibutor (or trigger) can advance no more. Set the max-advance stop to 21 degrees for "direct charge" inlines and 34 degrees for the older crossflows. Use the light, - err to the side of caution.
Right after max advance, further throttle motion should cause the second throttle pickup to hit and open the carbs to full. You already set that -now verify it.
Leave the throttle cable disconnected and go to the water. Leave the boat strapped to the trailer and back it in so it's deep enought to run. Have a friend crank it while you operate the choke and throttle. Warm it up at 1500 rpms's.
When "warm" adjust the idle stop screw for about 800 rpm and then ajust your idle needle(s) in (one at a time) till the motor stumbles. Quickly backing it out 1/2 turn from "stumble" will usually save it from needing a re-start. Do that for all the idle screws. Re-set idle stop for 800.
Now have your friend put it in gear (make SURE you are on the transom NOT in the water) and reset your idle stop for as low as you can get it. 500-600rpm is great if your old reeds will let it idle that low in gear. Now, re-adjust the idle screws, in to stumble, then 1/2 turn out. When you've gone back and forth with that a few times and have it "perfect" - adjust each one out 1/4 turn.
Reset the idle stop so that it's about 700-800 out of gear and 500-600 in gear. Sometimes bad reeds won't let you get that low, you've GOT to get it under 1000 in neutral (worst case) to avoid beating up your lower unit when you shift into gear, even 1000 is "bad" but like I said "worst case".
Now adjust (and hook up)the throttle cable so that with the shifter in neutral, there is light to moderate pressure holding the throttle arm against the idle stop.
Take the boat off the trailer and go out in the water. Try the hole shot. If it falls on it's face try adjusting the idle screws out 1/4 turn at a time (all of them together) till you can get a hole shot. You can kind of do this on the trailer at the ramp, but it's not really safe for you, the boat, or the tow vehicle.
You're done."
