February 1, 1986

A study by the space agency shows that a solid-fuel booster rocket of the shuttle Challenger experienced a sudden drop in power about 10 seconds before the spacecraft exploded, a source close to the inquiry said yesterday. Officials believe that the most plausible explanation for the power drop would be flames burning through the side of the right-hand rocket, the source said. NASA officials were said to believe that flames shooting out of the booster burned through the skin of the external fuel tank, to which the booster rocket was strapped, and through the liquid oxygen line inside. Began With Fire Fire erupting in the external fuel tank was believed to have led to the explosion that took the lives of the seven astronauts on board, the source added. At liftoff the external fuel tank holds 500,000 gallons of liguid hydrogen and liguid oxygen, which when mixed together are very explosive. Under control, combustion of the explosive mixture propels the rocket.

G.D. Searle & Company announced yesterday that, because of what it termed unwarranted lawsuits, it was discontinuing the sale of its two intrauterine contraceptive devices in the United States. About a million American women use Searle's Copper-7, the most frequently prescribed IUD, or its Tatum-T. Searle was the last major manufacturer of intrauterine devices in the United States to hold out against increasing costs of product-liability litigation and insurance. With the company's withdrawal, this type of birth control device will no longer be available in this country.

New York City's Commissioner of Investigation submitted his resignation yesterday, citing a continuing investigation into the way his office handled a disability claim that may have been fraudulent. The 48-year-old Commissioner, Patrick W. McGinley, said he was stepping down because the investigation, by the Manhattan District Attorney's office, would take too much time away from investigations of his own - particularly the one into allegations of extortion and bribe-taking in the city's Parking Violations Bureau. The District Attorney's investigation involves a disability claim filed by a correction officer assigned to the Department of Investigation who contended that he was injured while installing an air-conditioner in Mr. McGinley's apartment. No Impropriety During a news conference with the Mayor - a lengthy, unusually tense event in the Blue Room of City Hall - both Mr. McGinley and Mr. Koch insisted that the Commissioner, who is responsible for investigating the wrongdoing of others, was guilty of no impropriety. ''At this particular time, we need 110 percent of the energy from any Commissioner of D.O.I.,'' Mr. Koch said. ''I'm sorry that this particular matter has occurred which, in the best interest of the city, he believed, and I concurred, that he resign at this time. I wish him well.''

The Reagan Administration has put off indefinitely the pending sale of a $1.9 billion air-defense package for Jordan to avoid a virtually certain blocking of the deal by Congress, Administration and Congressional sources said today. The decision, which President Reagan made at the urging of his political advisers, was described by State Department officials as a disappointment to Secretary of State George P. Shultz. Mr. Shultz had said that the sale, which had already been postponed once, was crucial as a show of American encouragement for King Hussein's efforts to begin peace talks with Israel. Although Administration officials said they still hoped to be able to offer the arms package if the stalemate on peace talks can be ended, they acknowledged that it was unlikely the issue will be raised again this year.

President Reagan mourned the loss of ''our seven Challenger heroes'' today, paying tribute to their ''brave sacrifice'' and pledging to honor them with a renewed national commitment to the conquest of space. ''Sometimes when we reach for the stars, we fall short,'' Mr. Reagan said quietly in a solemn outdoor memorial ceremony at the Johnson Space Center before an audience of thousands, including relatives and colleagues of the fallen crew of the space shuttle. ''But we must pick ourselves up again and press on despite the pain.'' As many in the audience dabbed their eyes with handkerchiefs, the President said: ''Man will continue his conquest of space. To reach out for new goals and even greater achievements, that is the way we shall commemorate our seven Challenger heroes.''