For the sake of argument means to discuss a point hypothetically. The correct answer is this meaning because the expression is used figuratively, not only by its literal words.

Examples:

• For the sake of argument, let us assume the report is correct.
• In an HSC essay, For the sake of argument can express this meaning: to discuss a point hypothetically.
• When this expression appears in a passage, connect For the sake of argument with the idea of to discuss a point hypothetically.