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This is a transmission question. In general will a Muncie M21 work with a 3.55 rear end ratio. Normally I believe the 3.55 used a M20 wide ratio and the M21 close ratio was used with lower ratios like the 3.70. This is for a 350 HP motor.
Depends on what you want to do. A 7.81 overall first gear with the M-21 is a lot less than a 9.017 that the M-20 would have. It will be pretty long geared in first.
The gear *spread* % drop between the gears is about identical in the first 3 gears. The M-20 has a big drop going into 4th gear. So if you are just running up through the gears the M-20 will walk away from the M-21 with 3.55's in most cases. By the time you grab 4th in the M-21 you're going about 106 mph at 6000 rpm anyway. The M-20 will be running about 91-92 mph at 6000 rpm. The RPM is going to come up a lot quicker with the M-20. That's why it works so well in normal street cruising.
If you're road racing sometimes the M-21 is a better choice because you can get more speed in each gear and keep from having to shift as much. Each gear lasts longer which can make it easier to drive on some courses...unless you don't have enough power to pull the higher gears out of the corner.
If you're drag racing and have 4.56's or 4.88's the M-21 does well because it has a smaller drop into 4th gear percentage wise and helps the engine recover when it's under heavy load.
I have M-21 close ratio w/3:55. I would prefer the M-20s lower first gear. The ratios are too close for a hi tq motor like mine. It is slow off the line.