The correct answer is option 3 - stops. When the bucket falls freely under gravity, the water flow from the hole will stop. This is because as the bucket falls, it accelerates downwards due to the force of gravity acting on it. This acceleration causes the water to remain in the bucket due to inertia. Inertia is the tendency of an object to resist changes in its motion, and in this case, it prevents the water from flowing out of the hole as the bucket falls.

While the bucket is falling, both the bucket and the water inside it are subject to the same acceleration due to gravity. This means that the water inside the bucket will fall at the same rate as the bucket itself. As a result, the water flows relative to the bucket and remains inside it until the bucket hits the ground or comes to a stop. Therefore, the water flow stops when the bucket falls freely under gravity.

Alert - The correct answer should be option 2 - follows a parabolic path relative to the falling bucket.