Step 1: Recall magnetic pole behavior upon cutting.
Cutting a magnet creates two complete smaller magnets, each with N and S poles. Monopoles don't exist.
Step 2: Identify poles at the cut faces.
Original N---S becomes N---S and N---S. The newly created faces are S and N, which are unlike poles.
Step 3: Determine interaction.
Unlike poles attract, so the pieces attract each other.
Step 4: Final Answer:
They attract each other (option 2).