You can practice on Wrench's notebook - just ask him about it after finishing the club part of the tutorial. You can read about hacking in the FAQ.
Depending on the device’s protection strength, the number of said options increases. Regardless, one of them is the correct password and you need to find out which one it is by checking how many symbols match between the right answer and the one you picked. Planning ahead is the key.
So, as an example, the notebook has simple and sample in the options. Picking one of them will tell you that only 3 symbols match with the correct password while both words have more in common. This means both are wrong and you need to check other possibilities. This time it's quite easy but you can encounter trickier situations. Just separate options by "look-alike" groups and check them one by one.