"If there's a plastic cove
"If there's a plastic cover on the flame arrestor or a sticker on one of the valve covers (more likely that this is the case), it should indicate the gap and dwell. If not, call a Mercruiser dealer and ask what they should be set to.
If you look at the disrtibutor rotor shaft when you remove the cap and rotor, you'll notice that there's an area where the points are that has four lobes, or points that are rounded over. The fiber or plastic wedge on the points rides on this and when the point lines up with the wedge, the points are supposed to open. That little red or black plastic 'pill' is grease for the wedge, so the friction doesn't wear it away.
The theory behind the ignition system is this:
when current flows in a conductor, a magnetic field is created. If a set of windings has voltage applied to it, the magnetic field can be very strong and when you have another set of windings around or near the one with the voltage, the second set can be "saturated" by the magnetic field. How much saturation occurs is dependent on how long the voltage is applied to the first (primary) winding. The time interval is determined by the "dwell angle", and is caused by the points being kept open for a period of time that allows the coil to saturate. When the points close, the magnetic field collapses in the primary and the secondary and a strong voltage change occurs, causing the spark to jump at the plug tip but only if the voltage is sufficient. If the coil is shorted, the points never open or close for the needed time or if the condenser is faulty, the voltage will never be enough to cause the spark to jump, or it won't be intense enough. This is called a "collapsing field" system, since the voltage increases drastically when the points close.
The points are set with a feeler gauge and the distance should be listed on the previously mentioned cover or sticker. There will be a range, in the area of .016"- .024" and a dwell angle of about 26º- 34º. These numbers aren't necessarily what yours needs, so don't just set it to them. Get the correct specs from the dealer.
You can get a dwell meter at Sears for about $35 and there are digital ones available, too.
the coil is a transformer, since it has a primary winding and a secondary winding"