One of the first things I like to do when creating a new project is to get the I/O working. This helps in debugging the code as I write it.
What about projects that do not have I/O? This device sneeks both input and output from your computer (terminal program) to the PIC using just one pin.
In order for this circuit to work, you need to set either DTR (pin 4) or RTS (pin 7) to positive voltage. Turning on CTS/RTS hardware handshaking usually does this.
All serial data from the computer is transfered to the PIC as TTL true data. TTL true data from the PIC is converted to rs-232 level and sent back to the computer. Additionally, the transmitted data from the computer is prevented from echoing directly back (CR4 above).
For more detail: Serial to PIC Interface using PIC Microcontroller