In some cases, it would be useful to have contour polygons (that could then be color-filled or used for further polygon intersections) instead of just polylines. There would be some semantic issues with the boundaries of the rasters, though.
According to ArcGIS help docs, "The current version of Contour with Barriers only supports polyline output. If the polygon output option is used it will be ignored and polyline output will be created."
This functionality is currently available in the software.
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