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Slows IF it enters the water from air (and not - say - glass).
it decreases
That would depend what it enters from. If the light is transitioning from air to water,its speed decreases. If it's going from jello to water, its speed increases.
Air
It will not change. Glass slows light but does not change it frequency.
Water's particles are denser than air's, so when the light enters water, the light rays slow down, so travel at a shallower angle to the angle at which the light enters (incidence).
Diamonds have an extremely high index of refraction, the property that makes a spoon in a cup of water look bent at the point where the water meets the air. It causes light that enters the diamond come back out at different angles, and some of the light reflects within the diamond for a while before coming back out (it's the same phenomenon as when you look at the surface of the water in a fish tank from a very shallow angle below the surface and it looks like a mirror, except to a greater angle). Light traveling from a less dense medium, like air, into a more dense medium, like a diamond, is bent toward the normal, the imaginary line perpendicular to the surface where the two media meet at the point where the light enters. Light going from a more dense medium to a less dense medium is bent away from the normal. Also, different colors (wavelengths) are bent different amounts, which is how a prism works and why sunlight reflecting off the insides of raindrops creates a rainbow.
Diamonds have an extremely high index of refraction, the property that makes a spoon in a cup of water look bent at the point where the water meets the air. It causes light that enters the diamond come back out at different angles, and some of the light reflects within the diamond for a while before coming back out (it's the same phenomenon as when you look at the surface of the water in a fish tank from a very shallow angle below the surface and it looks like a mirror, except to a greater angle). Light traveling from a less dense medium, like air, into a more dense medium, like a diamond, is bent toward the normal, the imaginary line perpendicular to the surface where the two media meet at the point where the light enters. Light going from a more dense medium to a less dense medium is bent away from the normal. Also, different colors (wavelengths) are bent different amounts, which is how a prism works and why sunlight reflecting off the insides of raindrops creates a rainbow.
It slows down.
The answer for their brightness is the refractive index of them. the light which inters the diamond does not come out because of total internal reflection into air whose refractive index is close to vacuum's i.e 1. hence diamonds shine a lot. It has a lot to do with the cut. A good cut allows it to reflect light.
Einstein says that the speed of light is the same to all observers. This raises some interesting problems and his theories of relativity set out to solve them. But that aside, the speed of light is the same in olive oil and a diamond as it is anywhere else.
Given a light source and movement, a diamond will sparkle in air or under water. +++ I would expect the effect to be greater in air than in water though, because the density difference between diamond and surroundings are that much greater.