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Yes, they can go bad, they usually just quit working alltogether. With a fully charged battery you should have between 5 and 7 volts on the output side. I beleive the volt meter reading is prefered over the ohm meter reading, as the ohms can vary with the temperature of the resistor.
Do ballast resistors ever go bad ? What is in that ceramic block -if anything ? What should the resistance in ohms be for a good one?
From my experience, they either work or they don't. There is not any real shift in performance. The ballast resistor is comprised of a length of Ni-Chrome resistance wire and the ceramic wire form/housing.
A typical ballast resistor failure (when the resistor "opens") is when trying to start an engine, and it fires, but then shuts off as soon as the key is moved to the "Run" position. In other words, the engine will run in the "Start" position (since the ballast resistor is being bypassed), but of coarse you are not going anywhere with the starter grinding away!
The original "hot" resistor used from '56-63 was 0.3 ohms at room temperature, and the '64-'67 resistor was 1.8 ohms; the current reproduction runs from 1.8-2.2 ohms. As Plasticman said, they either work or they don't.