I would say that the correct answers are definitely 1 and 3.
The first option is correct because indeed powerful merchant families ruled these republics - this was the case especially in Venice, for example.
The third option is correct because most of the trade and crafting goods occurred in Italy, during Renaissance.
Two is incorrect because it was just the beginning of Renaissance so of course you cannot expect everything to be orderly then. Four is incorrect because the overall quality of goods was very good.