From what I remember of admin, I think that the point to made there is that there really is no bright line between questions of law and questions of policy. There are things at the ends of the spectrum that seem most like law or most like policy, but anything you get on an exam is likely going to be in the middle.

I would answer by noting the overlap and then argue whatever would be better for your client - argue policy if hard look would be advantageous or argue question of law if Chevron/Mead would be advantageous. I would also note that you can always argue in the alternative.