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But in that case, when the program RETURNs control to the caller, does the *NEW activation group end, or just become in-accessible, and just hang around until the entire job ends?
A *NEW activation group ends as soon as the program that created it ends. So, if you compile your RPG program with ACTGRP(*NEW), the activation group (and everything in it) will be destroyed when your program does a RETURN (no matter if LR is on or off)
That's why everything gets cleaned up when you haven't turned LR on.It's also why you shouldn't do it in a loop, because of the overhead of creating the activation group, opening the files, etc. For a program that will only be called a few times in a job, however, this cost isn't significant -- so only when it's in a loop (or for some reason is being called frequently) is it a really bad idea.
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