4. Understanding the Elements of SQL Statements : Common Table Expressions (CTEs) : How CTEs Are Used
 
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How CTEs Are Used
Each time a WITH element name is referenced, either from the main query or from another WITH element, a new derived table and correlation instance are created.
This is simple when a WITH element contains only a table or view in its FROM list. When one WITH element refers to another, however, derived tables are replicated for the full recursive set of referred to elements and not only for the element itself.