To determine the flow rate and PSI of water exiting a pipe, the continuity equation Q=Av can be applied, assuming friction losses are ignored. The pressure exerted by a piston of 2000 lbs over an area of 452.16 square inches results in a pressure of 4.42 PSI at the piston. When the pipe narrows to 1 square inch, the water exits at 4.42 PSI, not 2000 PSI. The relationship between the piston speed and the water exit speed can be established through their respective areas. For a comprehensive analysis, Bernoulli's principle should be considered to relate flow rates, heights, and pressures.