October 9, 1981

The Chase Manhattan Bank cut its prime lending rate yesterday for the second time this week, lowering it one-half percentage point, to 18 1/2 percent, but no other major banks followed its lead. Last Monday, when Chase reduced its rate to 19 percent, most of the nation's banks followed. ''Banks are uncertain about the big fluctuations in interest rates and also over near-term Federal Reserve Board monetary policy,'' said David M. Jones, an economist with Aubrey G. Lanston & Company.

A movie review yesterday incorrectly named the theater where ''My Dinner With Andre'' will open. The film begins Sunday at the Lincoln Plaza I.

A New York City police officer was shot at least five times yesterday after being ambushed from behind a parked car by a suspected drug dealer in the East Flatbush section of Brooklyn, the police said. The officer, Thomas J. Kennedy, 23 years old, of Floral Park, Queens, was listed in ''critical but stable'' condition at Kings County Hospital. Doctors said he was expected to live and he was well enough to talk with his wife and, briefly, with Mayor Koch from his bed in the intensive-care unit.

CBS Inc. and the American Telephone and Telegraph Company announced yesterday that they would jointly test a home information system with consumers in Ridgewood, N.J., beginning next autumn. The companies, which said in September that they were planning a marketing test of so-called video-text technology, said the trial would involve 200 Ridgewood households and be conducted in two threemonth phases starting next September. Consumers will participate for free. Video-text systems permit two-way communication between consumers and data bases of information stored in computers. In the Ridgewood experiment, households will be able to select from a variety of continually updated news, weather, sports, education and entertainment material culled from the broadcast and publications units of CBS. Furthermore, the test is expected to permit consumers to bank and shop electronically. Local and national advertising will also be displayed.

World leaders to gather for Sadat funeral A10 Egyptian warns of more blood- shed A10 U.S. bars Libyan U.N. delegate from Washington A11 International Foreign Minister sees "kind of stability" in Iran A2 Walesa supporters elected to Pol- ish union's board A3 Iranians prepares bill to expel Bazargan from Parliament A3 Around the World A5 Antimissile demonstration is readied in Bonn A6 Israelis hope for accord soon on military cooperation with U.S. A8 Canada says half of acid rain there is from polluters A9 Government/Politics Washington leaders upset over Congressional interference A17 Pentagon plan new warhead to in- crease MX missile power A18 U.S. panel asks lie tests to broaden access to secret data A23 Washington Talk Briefing A24 Justice O'Connor brings a differ- ence to the Supreme Court A24 The Republican Party's money isn't bringing it pure happiness A24 General Around the Nation A12 Chapels of Cal ifornia youth cor- rection sch ools bugged A22 China legal scholar leaves ivory tower and enters fray B3 Health/Science Scientists studying data linked to occurrence of earthquakes A15 Features/Notes Notes on People B9 Sports People B16 Weekend Weekender Guide C1 Where to view the fall foliage close to home C1 Metropolitan Baedeker: New London and Groton C1 Theater: Broadway C2 "Double Feature" at St. Peter's C3 Screen: At the Movies C8 Bertrand Blier's "Beau Pere" C10 "Rich and Famous," with Misses Bisset and Bergen C16 Music: All-night jazz at St. Peter's C1 Juilliard celebrates 35th year C3 Dorothy Donegan settles in at Michael's Pub C7 Art: Pousette-Dart works on view C23 Auctions C24 Noortman & Brod, European Masters gallery, opens C23 American art at Hirschl & Adler C26 Books: Publishing C28 "From Bauhaus to Our House" by Tom Wolfe reviewed C29 Restaurants C20 TV Weekend C31 Style The Evening Hours B10 Milan finale: Touches of whimsy B10 Three new Maxim's planned for the United States B10 Obituaries Frederic Theodore Kirkham Jr., medical director of Time Inc B13 Sports Yanks top Brewers, 3-0, and lead series by 2 games to 0 B15 Expos win second in row from Phils, 3-1 B15 Unser declared winner of Indy 500 B15 Pleasant Colony to miss Gold Cup B15 Hull abandons comeback bid with Rangers B15 Giants and Jets face divisional rivals Sunday B17 Taylor learning Jets' system B17 Astros try for series clincher against Dodgers today B18 Whalers tie Canadiens, 5-5 B18 Dave Anderson on Ron Davis and Goose Gossa ge B19 News Analysis William E. Farrell discusses Mubarak's Egypt A11 Edward B. Fiske on donor-univer- sity relations A16 Jane Perlez on advertising in Jer- sey campaign for Governor B2 Editorials/Letters/Op-Ed Editorials A30 The B-1 is a bomb An oil "glut" that raises prices Before the ballot Peter Passell: a tax rise? Letters A30 Tom Wicker: a new security mania A31 Flora Lewis: Nicaragua on a tightrope A31 John Ehrlichman: on First Family affairs A31 C.D. Rawicz: United Nations principle (so-called) A31 Mark Hertsgaard: nuclear Reaganomics A31