The annual range of temperature in the interior of continents is higher than in coastal areas primarily due to the thermal differences between land and water. Land heats up and cools down more rapidly than water, resulting in greater temperature fluctuations in continental interiors. This phenomenon is encapsulated in the concept of continentality, where the lack of a large body of water moderates temperatures, leading to more extreme seasonal variations compared to coastal regions where the ocean acts as a thermal buffer. Consequently, the correct answer is option 1 only.