Business leaders' confidence in the economy tumbled in the fourth quarter, as did their outlook for profits, but they are more optimistic about the next six months, "probably reflecting belief that the recession will end quickly," the Conference Board reported yesterday.

The business research organization's measure of business confidence dropped to 43 (on a scale of 0-100) in the final quarter from 57 in the previous quarter. The record low reading was 29 in the second quarter of 1980.

The 1,500 chief executives surveyed, however, were more pessimistic about current economic conditions than about the next six months. The current confidence measure was 26 in the fourth quarter, down from 48 in the preceding three months; the measure of expectations for the next six months dropped to 51 from 63.

MORE MERGERS: Corporate merger activity in 1981 was the heaviest in seven years, and their dollar value reached a record-shattering $82.6 billion, according to W.T. Grimm & Co.

There were 2,395 merger announcements last year, up 27 percent from the 1,889 in 1980, the Chicago-based merger consulting firm reported. The 1981 total was the highest since 1974, when 2,861 transactions were recorded.

So-called "mega-deals" helped push the total value of 1981 merger activity to nearly double the record set in 1980 of $44.3 billion.

KEYSTONE SOLD: Keystone Foods Corp. of Bryn Mawr, Pa., has agreed to be purchased by Northern Foods Ltd. of Great Britain for $69.13 million.

Keystone, a meat processor, supplies the McDonald's fast-food chain with half of its hamburger patties. Northern is a food processor whose major lines are dairy and meat products, milling and baking.