Economic illiteracy is rampant among America's high school students, according to a first-of-its-kind survey that found only a dismal one in three was able to define simple concepts like inflation or profits.

Results of the survey, involving 8,205 11th- and 12th-grade students in public and private high schools in 33 states, were released Wednesday at a news conference featuring Paul A. Volcker, chairman of the Federal Reserve Board from 1979 to 1987.It found only 34 percent taking a multiple-choice exam in economics, popularly known as the "dismal science," were able to correctly define profits as "revenues minus costs."

And just 39 percent selected the correct definition of Gross National Product: "the market value of the nation's output of final goods and services."

The news is "not good if you believe that a basic understanding of our economic system is important if this country is indeed to be effective in what everyone realizes is a period of global competition," Volcker said.

Students across the country took a 40-minute, 46-question multiple choice "Test of Economic Literacy" in May 1986, said William B. Walstad, a University of Nebraska-Lincoln economics professor who developed the exam with John C. Soper, an economics professor at John Carroll University in Cleveland.

On average, students correctly answered only about 40 percent of the problems but were even weaker on simple questions pertaining to inflation, the effects of tariffs on trade, and the impact of investment on economic growth, Walstad said in a telephone interview.

The report found that white students who had had some high school economics scored an average of 53 percent, blacks 42 percent, and Hispanics 46 percent.

Among youngsters with no economics background, whites answered 41 percent of the questions correctly, blacks 33 percent, and Hispanics 36 percent.

Rudolph Oswald, director of research of the AFL-CIO, called the results "appalling."

"They rationalize better than any series of speeches the reasons why organized labor feels it can only gain from an economically literate population," Oswald said.

The survey was sponsored by the New York-based Joint Council on Economic Education, a non-profit, nationwide coalition aimed at promoting economics instruction from kindergarten through high school.

The exam was the first to document the apparent economic illiteracy of a majority of U.S. high school students. Economics thus joins a growing list of disciplines including writing, geography, foreign language, science and math where recent tests have shown U.S. students achieving at dismal levels.

Japan requires all high school students to take at least a semester of economics, Walstad said. But only 28 states require economics in the curriculum in some form, and just 15 require economics for graduation.

"All too often economics is simply left out of the list of required subjects in recent calls for educational reform," Walstad said.

Compounding the problem, few teachers can teach it.

"Teachers are the first to realize that they have inadequate background in the subject," said Roxanne E. Bradshaw, secretary-treasurer of the National Education Association.

Texas, for example, recently established a high school economics requirement, but only 5 percent of secondary teachers in that state have ever taken an economics course, she said.