June 21, 1985

FRIDAY, JUNE 21, 1985 The Economy The economy is growing at a 3.1 percent annual rate in the second quarter, according to the Commerce Department's ''flash'' estimate. The preliminary figure showed increased investment and buoyant consumer spending, as well as a reduced economic drag from imports. There was conjecture that the new figure might halt the recent decline in interest rates. The first quarter's growth was revised downward to a scant 0.3 of 1 percent. [Page D1.]

F.A.O. Schwarz, the 22-store retailer whose lavish toys and games have delighted children and their indulgent parents for more than a century, is being acquired by the Christiana Companies, a California real estate developer and investment company. Christiana will be Schwarz's third owner in 11 years. The announcement yesterday by Christiana and Franz Carl Weber International, parent of F.A.O. Schwarz, said that their boards had approved the all-cash purchase. The amount was not disclosed. Christiana said it would continue and even expand the toy retailer. John S. Roberts, Christiana's chairman, also said that ''some consideration may be given to closing some of the stores but we have no immediate plans for it.''

Senator Bob Packwood, chairman of the Finance Committee and the most influential Senator on tax matters, said today that he expected President Reagan to modify his tax revision plan to make it more favorable to middle-income taxpayers. Senator Packwood, an Oregon Republican, said at a news conference that tax officials in his state had calculated the effects of the President's proposals and had determined that ''a great many more middle-income taxpayers are adversely affected'' than the Administration had realized. ''We in Congress must concentrate in getting more and significant relief to our broad middle class,'' the Senator said. ''Without them, we won't have tax reform.''

The nation's economic activity is expanding in the second quarter at a moderate annual rate of 3.1 percent, after having virtually stalled in the first quarter, the Government said today. The Commerce Department's ''flash'' estimate showed increased business investment, continued buoyancy in consumer spending and a reduced economic drag from imports. It also showed that inflation abated in the spring. In another report today, the Labor Department said consumer prices rose in May by two-tenths of 1 percent, less than in April. [Page D12.] ''The worst of the slowdown probably is behind us, and we should be back on a higher growth path by summer's end,'' Commerce Secretary Malcolm Baldrige said.

The Village Voice, the outspoken liberal weekly that has been owned by Rupert Murdoch since 1977, was sold yesterday to Leonard Stern, a wealthy businessman. Announcement of the sale was greeted with apprehension by The Voice's staff, many of whom said they regard Mr. Stern as highly conservative and antithetical to the newspaper's tradition. [Page D3.] Mr. Murdoch's News America Publishing Inc. said in a statement that The Voice had been sold for more than $55 million, which had been Mr. Murdoch's minimum asking price.