In Italian possessives behave just like any other adjective - they have to agree on gender and number with the noun they qualify, that is with the possession, but not with the owner. In this sentence the noun (vicina) also semantically agrees with the subject (lei). If the subject is "lui", the whole noun phrase must also be masculine. On the other hand, if the noun has only a single masculine/feminine form, both the article and the possessive must agree with the only possible gender of the noun, despite the gender of the subject.
Syntactic and semantic agreement:
- Lei è la nostra vicina = She is our neighbor
- Lui è il nostro vicino = He is our neighbor
- È la nostra vicina = She is our neighbor
- È il nostro vicino = He is our neighbor
Syntactic agreement only:
- Lei è il nostro capo = She is our boss
- Lui è il nostro capo = He is our boss
- È il nostro capo = He/she is our boss
The last sentence has ambiguity of the subject gender.
Speaker group composition has nothing to do with the pronoun. The subject pronoun is always "noi" and the possessive is always nostro/nostra/nostri/nostre depending only on the noun/possession they qualify.
neighbour is correct too. http://www.linguee.com.br/ingles-portugues/traducao/neighbour.html
Please don't tell me to practice everyday when I am stuck on a question which requires me choose an option and no options are available and therefore I am stuck in a lesson and can't get out because of this fault,hence I go round in circles! Please sort this out!it only requires a modicum of common sense to see the problem.