At the heart of means central to the main issue or problem. The correct answer is this meaning because the expression is used figuratively, not only by its literal words.

Examples:

• Poverty lies at the heart of many social problems.
• In an HSC essay, At the heart of can express this meaning: central to the main issue or problem.
• When this expression appears in a passage, connect At the heart of with the idea of central to the main issue or problem.