**Core Concept**
Polyarteritis Nodosa (PAN) is a medium-vessel vasculitis characterized by inflammation and necrosis of the arterial walls, leading to aneurysm formation and subsequent organ damage. This condition primarily affects the medium-sized arteries, sparing the small arteries and arterioles.

**Why the Correct Answer is Right**
The correct answer involves the renal arteries, which are a common site of involvement in PAN. This is due to the involvement of the medium-sized arteries, such as the renal arteries, which supply blood to the kidneys. The inflammation and necrosis of the arterial walls in PAN lead to the formation of aneurysms and subsequent organ damage, including renal failure. The renal involvement in PAN is a classic clinical feature and a key aspect of the disease.

**Why Each Wrong Option is Incorrect**
**Option A:** PAN typically does not involve small arteries and arterioles, which are more commonly affected in other vasculitides such as microscopic polyangiitis.
**Option B:** PAN does not typically involve the pulmonary arteries, which are more commonly affected in conditions such as pulmonary vasculitis.
**Option C:** PAN does not typically involve the hepatic arteries, which are more commonly affected in conditions such as hepatitis or liver cirrhosis.

**Clinical Pearl / High-Yield Fact**
PAN is a classic example of a medium-vessel vasculitis, and the renal involvement is a key clinical feature. It's essential to remember that PAN typically spares the small arteries and arterioles, which are more commonly affected in other vasculitides.

**Correct Answer:** C.