Step 1: Identify the phrase as an idiom. Idioms have figurative, not literal, meanings. Literal interpretations in options (A), (B), and (D) are probably wrong.
Step 2: Find the figurative meaning. The idiom "to hit the nail on the head" means to perfectly describe a situation or to act in the most effective way.
Step 3: Link the meaning to the options. Option (C), "to do or say exactly the right thing," accurately represents the idiom's figurative meaning.