Feel the pinch means to suffer because of lack of money or resources. The correct answer is this meaning because the expression is used figuratively, not only by its literal words.

Examples:

• Families began to feel the pinch after prices rose.
• In an HSC essay, Feel the pinch can express this meaning: to suffer because of lack of money or resources.
• When this expression appears in a passage, connect Feel the pinch with the idea of to suffer because of lack of money or resources.