What is the function of the SET statement in a SAS data step?

The SET statement in a SAS data step is primarily used to read observations from an existing data set. When you include a SET statement in your data step, you are instructing SAS to access data from a specified data set, effectively pulling in all rows and columns of that data set for processing. This allows you to manipulate the data, create new variables, or perform analyses based on the contents of that existing data set.

When using the SET statement, you can also combine it with additional SAS programming techniques to create new data sets, summarize data, or merge information from multiple data sources. However, its main function is to facilitate reading data so that subsequent processing can occur smoothly within the data step.

The other options might relate to the overall data manipulation process in SAS but do not correctly define the specific function of the SET statement. For instance, while creating a new data set or appending data could occur within a data step, it is achieved through other statements and processes, not directly by the SET statement itself. Similarly, defining new variable formats pertains to formatting data and is handled by format statements rather than the SET statement.