The correct statement is:
4) the salt water will sink below the incoming fresh water because it is less dense.
When freshwater flows into a lagoon of saltwater, the less dense freshwater (density of 1.0 g/cm³) will float on top of the denser saltwater (density of 1.03 g/cm³). This means that the saltwater will not rise above the freshwater; rather, it will remain beneath it.