While passing the pass-through arguments individually to the Start-Process cmdlet's -ArgumentList parameter may be conceptually preferable, a long-standing bug unfortunately makes it better to encode all arguments in a single string - see this answer.
Using -Verb RunAs to launch a command with elevation (as admin), invariably uses the SYSTEM32 directory as the working directory - even a -WorkingDirectory argument, if present, is quietly ignored. Thus, in order to set a custom working directory and to invoke , the -Command CLI parameter must be used, and a Set-Location (cd) call must precede a call to a script specified by relative path.
Doing all this from cmd.exe, via powershell.exe, the Windows PowerShell CLI, complicates matters due to escaping requirements.
Applied to your powershell.exe CLI call (assuming dir. C:\path 1 and script file setup 1.ps1):
powershell -Command "Start-Process -Verb RunAs powershell '-NoExit -ExecutionPolicy Bypass -Command "^"" cd \\"^""C:\path 1\\"^""; & \\"^"".\setup 1.ps1\\"^"" "^""'"
Note:
From cmd.exe, "^"" (sic) is the most robust way to pass " that are embedded in an overall "..." string to powershell.exe (from a shell-free context, such as a scheduled task, use """ or, more simply, \".
For simplicity, for the doubly nested " chars. the \-escaping technique is used above, with the \ chars. themselves requiring escaping as \\.
Note: From the PowerShell CLI perspective - including in PowerShell (Core) 7+ (see below) - \" always works, but its use is problematic from cmd.exe, which doesn't understand \" as an escaped " char. and therefore treats it as a regular string delimiter, which can cause it to misinterpret what's been \"...\" as being part of an unquoted strings, where metacharacters such as & can then break the command, because they're interpreted by cmd.exe itself, up front; e.g., powershell -c " \"Abbot & Costello\" " breaks from cmd.exe, requiring either ^& instead of " or, as shown above, escaping embedded " as "^"" instead:
powershell -c " "^""Abbot & Costello"^"" "
When you call pwsh.exe instead - the PowerShell (Core) 7+ CLI - two simplifications are possible:
In addition to \", pwsh.exe more simply supports "" for embedding " chars. in "..." strings; the latter works robustly from cmd.exe
pwsh.exe now has a separate -WorkingDirectory parameter, which therefore allows invoking the script with the -File parameter - do note, however, that the file path is resolved before the working directory is set, so the full path is used below.
pwsh.exe -Command "Start-Process -Verb RunAs pwsh.exe '-NoExit -ExecutionPolicy Bypass -WorkingDirectory ""C:\path 1"" -File ""C:\path 1\setup 1.ps1""'"