What determines the area revenue protection guarantee?

The area revenue protection guarantee is determined by the greater of the projected price or the harvest price. This structure ensures that if market conditions change throughout the growing season—such as fluctuations in crop prices—the guarantee offered to the insured is reflective of the best possible outcome based on those prices.

By using the greater value between the projected and harvest prices, the policy effectively protects against declines in crop prices while still allowing for potential increases in revenue if the harvest price is higher than originally anticipated. This mechanism helps safeguard the income of farmers by ensuring that they receive the benefits of increases in crop prices while also providing a safety net when prices fall.

Other options, such as the average market price or the regional average yield, do not directly influence the revenue protection guarantee in this context, as the area revenue protection specifically focuses on price variations in the projected and harvest phases. Thus, the selected answer accurately captures the foundational principle of the area revenue protection guarantee.