"We are just friends."
Translation:אנחנו רק ידידים.
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Should be accepted. I think what was meant here, the only context in which the word ידיד is used in modern daily Hebrew, is to emphasise that there is no romantic involvement, because חברים is often used to mean a dating couple. But this sentence can legitimately mean also "we are just friends, not siblings", or "we are just friends, not work partners" etc., in which case חברים could be a appropriate.