ConceptVerbal · Data Insights

Causal Reasoning: Test the proposed cause against competing stories

A causal argument says that changing or observing X explains a change in Y. The GMAT tests whether the evidence isolates that relationship from reverse direction, common causes, selection effects, and concurrent changes.

Observation is not intervention

Suppose customers who use a budgeting feature save more money.

Two stories fit:

The feature helps customers save.
Customers already motivated to save are more likely to use the feature.

The observed association does not by itself distinguish the feature effect from self-selection.

Now imagine comparable users are randomly invited to use the feature, and the invited group increases savings relative to a control group. That design gives the causal conclusion more support because it reduces pre-existing group differences.

The five questions to ask

Direction: Could the proposed effect influence the proposed cause?
Alternative cause: Could another factor produce both?
Selection: Why did observations enter each group?
Timing: Did the cause occur before the effect?
Mechanism: Is there evidence for how the cause would produce the effect?

The correct answer usually matters because it changes one of these.

How question types use causality

Strengthen

Rules out an alternative, improves comparability, establishes time order, or confirms the mechanism.

Weaken

Introduces another cause, reveals selection, reverses direction, or shows the effect existed already.

Evaluate

Asks for information whose possible answers would make the causal claim meaningfully stronger or weaker.

Assumption

Identifies a causal bridge the argument needs but does not state.

Critical Reasoning Very Hard · weaken

The city council of Lakewood is considering a ban on happy-hour drink discounts in all bars. Opponents argue that the ban will reduce bar revenues because customers will buy fewer drinks at regular prices. The council counters that this objection is unfounded. Several cities in the region imposed restrictions on happy-hour drink discounts five years ago. Since then, the amount the government collects in bar and restaurant alcohol taxes in those cities has increased 29 percent on average, compared with only 21 percent in other cities. The amount collected in alcohol taxes closely reflects bar revenues.

Which of the following, if true, most undermines the argument?

A When the region first imposed an alcohol tax, opponents predicted that bar revenues would decline, and this prediction proved correct in the short term.
B The alcohol tax rate is higher than the tax rate on many other goods and services.
C Over the last five years, alcohol consumption has steadily declined throughout the region.
D In many of the cities that restrict happy-hour discounts, bars may offer discounted drinks if they are served with a full meal.
E Over the last five years, government revenues from all sales taxes have grown no faster in the cities with happy-hour restrictions than in the cities without such restrictions.

Answer: D

The argument uses cities with earlier happy-hour restrictions as evidence that a complete ban would not reduce bar revenues. Option D shows that those cities' restrictions were only partial: bars could still offer discounted drinks with a full meal. Thus the sample cities' experience does not demonstrate the effect of a total ban. Option A is irrelevant because it concerns a past prediction about an alcohol tax, not the current policy. Option B compares tax rates across products, which is irrelevant. Option C describes a regional trend that would affect all cities and cannot explain the differential growth. Option E, if anything, rules out a broader economic explanation and does not weaken the specific evidence.

Original GMAT-style question written for Premiergrad and checked by an independent blind solve. Not an official GMAT question.

What Lumen looks for

Lumen reads the answer you chose, not just whether it was wrong. On a question like this it separates three things that all look identical in a score: a concept you have not met, a reasoning step that went sideways, and a correct method pointed at the wrong target. Those need three different next weeks, and only the third one is fixed by re-reading the topic.

A single answer is weak evidence and Lumen says so. It becomes a diagnosis when the same shape shows up across several questions — which is the part a page like this cannot do for you.

Common mistakes

treating “after” as “because of”
assuming a control group is comparable without evidence
accepting a believable mechanism as an established mechanism
believing correlation never provides evidence; it can provide evidence without proving the claim
choosing an answer about the same topic that does not change the causal comparison

What mastery looks like

You can generate competing explanations, name the evidence that would distinguish them, and identify which causal vulnerability each answer choice affects.

Continue with GMAT Causal Reasoning Questions, Strengthen and Weaken, or Evaluate the Argument. If you often infer causes from effects, review Causal Confusion and Conditional Reversal.

Practice causal arguments →

Trap Causal Confusion
Causal Confusion occurs when an association, sequence, or group difference is treated as proof that one factor produced…

What goes wrong when the pattern becomes a cause.
Concept Assumptions
An assumption is an unstated claim the argument requires for its evidence to support its conclusion.

The bridge a causal conclusion needs.
Practice GMAT Assumption Questions
An assumption is not just a fact that helps. It is a bridge the argument needs. This set makes that distinction visible…

Causal arguments, with the alternative cause named.

Knowing it and recognising it are different

Most people who miss questions on this concept can explain it perfectly. What separates them is spotting it when the question does not name it. The diagnostic tells you which of the two you are.

Practise this concept Everything on this page stays free and open — no account needed to read it or to attempt the questions above.

Last reviewed 2026-09-17