Permanent data set means to create a Library, Libname statement should have been covered in your class, and place the result there. That means to use the data set you use the libname.dataset on any DATA= options or Set statements.
Without seeing the data I am not sure that a MERGE would be the proper way to combine the datasets. That may result in common named variables having the values from only one data set. It may be that SET or Proc Append to stack the data is more appropriate.
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