Here is the explanation as to how and why many '60s muscle car engines were underrated:

"Insurance companies started to balk about insuring these wild engines on the street, especially with young drivers under 21. Some insurers set an arbitrary minimum of 10 pounds per horsepower for young drivers. This the the reason for the GM front office policy in the late '60s of limiting production models to the 10 lbs/minimum on curb weight. (This is why Chevy cut the rating of the L-79 327 engine from 350 to 325 hp in '66.)

And then there were the safety critics. Ralph Nader was hollering about more than the Corvair in the mid-'60s. The safety do-gooders were saying that horsepower was a chief killer on the streets and highways. Detroit didn't pay much attention until some Washington Congressmen began singing the truth. Then it was Panic City.

What it all boiled down to is that Detriot never raised hp ratings above the range of 425-450 hp, regardless of what the engines actually put out. And the companies were more apt to keep the ratings below 400 hp if at all feasible.

Did they lie? Not necessarily. What they did was use a rating trick that had been used for years for trucks and marine engines. They simply rated the power at some point below the power curve. You're all familiar with how a full-throttle power curve for an engine rises very swiftly in the medium range, then bends over into a smooth, round peak at the top. There's no law that says you have to rate the engine right at the very peak of the curve.

The trick worked just as well on free-breathing car engines. Take the Mopar 440-6 Pack. It was rated at a modest 390 hp at 4700 rpm. But the true peak here was 430 hp at 5600 rpm. Chrysler engineers just looked at the line at the power curve, and maybe stuck a pin in the line at 4700 rpm. The 390 hp sounded a lot less dangerous to insurance people than the true peak of 430 hp.

The next question is: How do we figure the true power peak from the advertised torque figure?
Easy. If you study dozens of power and torque curves for high-performance V-8 engines, you will find an interesting pattern emerging. That is, the torque at the peak of the power curve is roughly 15% below the maximum torque in the mid-range (where torque is rated). And the rpm at peak power is roughly 50% above the rpm at peak torque. So really all we need to know the estimate of true peak power is the true peak torque at what rpm. And since the factories never fudged on torque ratings, this gives us a perfect way to estimate what the various muscle car engines actually put out at the peak of the power curve.

Just as an example, assume the engine has a maximum torque of 470 lbs/ft at 4000 rpm. The torque at peak power would be .85x470=400 lbs/ft, and the peak of the power curve would be 1.5x400=6000 rpm. And the actual hp at the peak calculates out to 457 hp. That's all there is to it."