Final answer:
The MERGE statement is the method that continues to read observations until the last observation is read from the largest dataset to merge datasets.
Step-by-step explanation:
The correct answer is b) MERGE statement. The MERGE statement is used to combine datasets in SAS by merging observations based on a common variable. When merging datasets, the MERGE statement reads observations from the largest dataset until the last observation is read. It then matches the common variable in the smaller dataset and adds corresponding observations to the merged dataset.