Chad,
If your TKR-850 is a Version 2 radio, the output should be stable at 5 watts in the low power setting. I have ran them as low as 1 watt and never had a problem.
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The early radios prior to the Version 2 series did have PA issues, but many of those were updated with a new PA deck under a Service Bulletin procedure by Kenwood.
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Joe - WA7JAW