South Dakota Crop Insurance Practice Exam

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Prepare for the South Dakota Crop Insurance Exam. Study smart with flashcards and multiple choice questions; all questions feature hints and detailed explanations. Ace your exam effortlessly!

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The YP Plan is available only for crops that are what?

Insured by the government
Traded on the commodity exchange
Locally produced
Organic certified

The correct answer is: Traded on the commodity exchange

The Yield Protection (YP) Plan is specifically designed for crops that are traded on the commodity exchange. This means that the crops eligible for this plan have a market presence and are subject to price fluctuations based on trading activity. The importance of being traded on the commodity exchange lies in the ability to establish a reliable, market-driven price for these crops, which ultimately helps in determining the indemnity levels and the insurance payout in the event of a loss. Crops that are not traded on the exchange, such as locally produced varieties or organic certified crops, may not have the same level of market data or price transparency necessary for the YP Plan. Hence, options related to government insurance or local production don't apply to the criteria for the YP Plan. Understanding this distinction is crucial for farmers when selecting the appropriate insurance plans for their crops based on market dynamics.