Which statement about the INPUT and INFILE methods is incorrect?

The statement indicating that INPUT is used for external files only is incorrect because the INPUT statement is primarily used to read data from raw data lines in a DATA step, which can include not only external files but also inline data provided by the DATALINES statement. The INPUT statement is versatile and can be utilized for structured data, allowing it to read data from multiple sources, including the DATALINES, which can be helpful for defining small datasets directly within the SAS program.

The other statements are correct in context. Both INPUT and INFILE are indeed used to read data into SAS, with INPUT reading the data and INFILE specifying the external source of that data. The statement regarding INFILE being the standard method for handling large datasets holds true as it allows for efficient reading of large volumes of data from external files without bringing the entire dataset into memory at once. Lastly, DATALINES provides an easy way to include small datasets within a program, exemplifying how SAS can allow users to quickly enter data directly into a DATA step.