So you just bought a Merkur and you love how fast it is and how little you paid for it. Now for a reality check. You might want to do a lot of things to your car that you think will make it faster. A lot of people have already gone through this and this is a list of the most common mistakes made when trying to make an XR faster.
Don't use platinum plugs. They run too hot and don't have enough of an electrode to do well in a boosted engine.
Don't switch over to Synthetic oil. Keep using the same oil that has been in the car. If the engine has a lot of miles it will probably just start to leak around all the seals if you switch to synthetic from normal oil. This is because normal oil is not as thin as Synthetic oil. Also the seals have been sealed with dirt that moves around with the oil in an engine and this seals the leaks in old seals. As soon as you clean out this dirt the seals will start to leak.
Don't install an aftermarket ignition. The stock ignition parts took Rick Byrnes car over 200 MPH.
Don't bother thinking about putting in a bigger engine. You can get plenty of power out of the stock engine.
Don't put in a K+N filter unless you can get cold air to it. If it is sucking in hot engine air you will lose power.
Don't put in a bigger cam until you have the car running right without it.
Don't let the car run hot ever at all. Keep the temp gauge no higher than halfway. If it goes higher get a new radiator or find out if their is another problem with the car. Cooling problems are the number one cause of engines breaking.

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Now for a couple of things that you must do!

Go to Carlisle and meet over one hundred other Merkur owners.
Learn how to run the codes with a 30 dollar code reader or a voltmeter.
Buy Allan Slocum's book on the 2.3 turbo engine.
Sign up on the Merkur IMON mailing list.
Put on a full three inch exhaust.
Put in new Autolite 764 plugs set to .030 inches and Motorcraft wires.
Put on an intercooler, any intercooler. The bigger the better. The more it cools the air the better.
Unless it has been done already you probably need to replace all the rubber bushings in the car. If your front end shakes when you hit the brakes this solve that problem.
Flush the cooling system and replace all the hoses unless they are new.