I am not sure about a 77, but my '80 has the headlite on all the time the bike is running. The headlite comes on after it starts, but the tail lite comes on as soon as I turn the key on. under the fuel tank, there is a round flasher assy, with 3 wires going to it. One will be hot( + voltage) with the key on. One of the other's goes to the signal switch on the left handlebar.The third wire goes to the self canceler unit, forget about that for now. You want to jump the hot wire to the wire that runs to the switch. Place the switch in either direction, and see if that side lite's up. If it does, the problem is a bad flasher. Alot of people run the 552 flasher available at any parts store. It is only 2 prong, and you will have to shut the blinkers off yourself. Most of the self canceler unit's quit working along time ago, and are not reliable at best, so don't worry about it. If the signal side you slected does NOT lite, the switch is bad. Some can fix them, most cannot. Your tail lite might be normally on with the key, if not, then you probably got another bad switch on the other side. Make sure it is indeed your tail lite and NOT the brake lite, 'cause thats a whole different problem. Still switch related, maybe the switch in the master cylinder is stuck, or on the rear pedel arm.
To do a continuity test, set your meter to one of the Rx position's(Rx10, Rx100ect). One probe on one end of the wire/circut, the other on the other end. Read what the meter reads, open circut will read infinity, a closed circut(one that is complete) will have a number displayed on a digital meter, or the needle will move on an analog type meter.
One more thing, to check the charging system, start the engine and rev up to 2500-3000 rpm. One lead one the battery positive post, the other lead on the negative post. You should have at least 13.3 volt's. Up to 14.6 volts. Any more and the battery will cook.Any less than 12.2 you have a charging problem.