An article yesterday in- correctly reported that a majority of the people interviewed in a Washington Post-ABC News public opinion poll said they expect relations with the Soviet Union to worsen now that Mikhail Gorbachev has replaced Konstantin Chernenko as leader of the Soviet Union. The majority in the poll, 53 percent, said they expect no change in relations between the two nations. Six percent expect relations to worsen, and 38 percent said they think they will improve. The remaining 3 percent offered no opinion. Remarks attributed to City Council member Frank Smith Jr. (D-Ward 1) in a Metro section article yesterday about opposition to a sexually oriented business in the District were made by council member John A. Wilson (D-Ward 2).

Public sentiment for cutting military spending is growing despite pessimism about relations with the Soviet Union, according to a Washington Post-ABC News national opinion poll.

Fifty-three percent in the poll, taken Thursday through Monday, said they favor making "substantial cuts" in military spending, with 44 percent opposed. That reflects a shift since January, when a similar survey showed 51 percent opposing substantial military cuts and 46 percent favoring them.

The new poll also indicates that 53 percent expect relations with the Soviets to get worse now that Mikhail Gorbachev has succeeded the late Konstantin Chernenko as Soviet leader. A higher proportion, 58 percent, say they feel that current negotiations between the two superpowers in Geneva will not produce a new arms-limitation agreement.

The poll also showed the public to be closely divided on development of the MX missile, despite President Reagan's hard lobbying for it.

Although he is staunchly opposed to military budget cuts, Reagan received higher grades for his conduct of foreign policy than at almost any other time in his presidency. And he received better ratings in that area than for his domestic policies.

Fifty-seven percent of those interviewed said they approved of Reagan's handling of foreign affairs, and 36 percent said they disapproved. The last time he scored that well was in late 1981.

By comparison, 51 percent said they approved of Reagan's handling of the nation's economy, and 47 percent said they disapproved. That is the lowest rating he has received in almost two years.

Reagan's response to the budget deficit and to the plight of many farmers drew the heaviest criticism. Fifty-six percent said they disapproved of his handling of the deficit, and 58 percent disapproved of his handling of the farm situation.

The president's popularity rating remains high but dropped slightly since his second inauguration. Sixty percent said they approved Reagan's handling of the presidency, compared with 68 percent in January. His disapproval rating rose to 36 percent, compared with 28 percent in January.

The poll also indicated increased awareness of the MX missile debate and events in Nicaragua. Knowledge of the change in Soviet leadership also was higher than might have been expected.

On the MX, the public was sharply divided along party lines, with Republicans favoring it by 2 to 1 and Democrats opposing it by the same ratio. Overall, 45 percent said they favored it, and 47 percent opposed it.

Ninety-two percent of those interviewed said they had heard or read about the MX. In September 1983, the last time the Post and ABC News made such an inquiry, 83 percent said they had heard or read of the missile. At that time its development was favored, 51 to 39 percent.

The wide-ranging poll, in which 1,506 people were interviewed by telephone, also showed continued, lopsided opposition to U.S. involvement in overthrowing the Sandinista government in Nicaragua.

Seventy-two percent said they oppose such involvement; 16 percent supported it. In a February Post-ABC News poll, sentiment was virtually the same, at 70 percent to 18 percent.

The new poll indicates that Nicaragua concerns many Americans who paid little attention to it until recently. Eighty-one percent said they know of the strife between the Sandinistas and the rebels. In 1983 and 1984, no more than 59 percent of those surveyed in Post-ABC News polls expressed such awareness.

Thirty-seven percent in the new survey stated correctly that the United States is supporting the rebels, not the government. That is a higher proportion than in four other Post-ABC News polls.