If the stock price is $40, the strike price for either call or put on this stock is $43, and the option premium is $4.

1. If this option is a call, the buyer will exercise it

2. If this option is a put, the buyer won't exercise it because profit is insufficient to cover option premium.

3. If this option is a call, the seller will exercise it

4. If this option is a put, the buyer will exercise it