This is the 32nd most frequent Icelandic word.
hún
"She" or "it" (feminine).
The word 'hún' is used here as a pronoun to refer to a female subject, 'she', in the nominative case.
Hún er kennari.
She is a teacher.
The word 'hún' refers to the word 'bókin' (book), which is a feminine noun in Icelandic. Here it is used to indicate 'it'.
Þar er bókin hennar, hún er á borðinu.
There is her book, it is on the table.
In this instance, the word 'hún' functions as a pronoun referring to a female person who is the subject of the sentence.