1 is correct. Laissez-Faire is the theory of no government intervention in trade. In the late 1800s there were a lot of wealthy big businesses, mainly corporations, that were causing the ruin of smaller ones. People who opposed big business called for government regulation of it. The supporters of big business attempted to justify it using Laissez-Faire.
"A laissez-faire economy gives businesses more space and autonomy from government rules and regulations that would make business activities harder and more difficult to proceed. Such an environment makes it more viable for companies to take risks and invest in the economy."
The answer is C. (International Sovereignty).
Hope this helped!