Water flows out of the hole on the side of a bucket and follows a parabolic path. If the bucket falls freely under gravity, ignoring air resistance, the water flow...
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When the bucket is stationary, the pressure from the water above the hole, due to its weight, pushes the water next to the hole outward from the bucket. But when the bucket is falling, all the water in the bucket is in essence weightless, and hence there is no longer any relative pressure on the water next to the hole. Without any pressure, there is no impetus for the water to exit the bucket, i.e., the water flow would stop.
If there were air resistance to consider, then things get more interesting. Gravity would act on both the bucket and water, but air resistance would act solely on the bucket. This would mean that the water would no longer be weightless, as the bucket would essentially be "pushing up" on the water inside, creating pressure. This pressure would then provide impetus for the water next to the hole to exit, albeit at a lesser rate than when the bucket is stationary.