Engine cuts out at higher range

[Dave M]

.40 K & B Marine engine. 70's model [4012], but till recently had not been run. Around an hour running time. Using 20% nitro mix. Cuts out at higher throttle. Carb has two set screws High and Low setting.
I've checked for Fuel leaks and does not appear to be the a problem. However when running I notice a few small air bubbles within the line to the carb? I've also pulled the carb apart and cleaned. Could this carb be defective? Is there better luck with the carb's with the needle valves separate from engine and carb?

[MECOA]

This is for an airplane but it also applies to boats
http://www.mecoa.com/faq/fuel/tank.htm

Hers's tuning info on the carb
http://www.mecoa.com/faq/carb/kbsq/kbsq.htm

and for a boat
http://www.mecoa.com/faq/carb/needle_marine.htm

doubtful carb is bad, maybe misadjusted.