"x" and "y" may take the value 0 or 1.
The relationship becomes a logical entity (whatever the dimension of the relationship). The properties of the relationship become the properties of this new logical entity.
The key of this new entity is the concatenation of the keys of the entities which participate in the relationship.
In the case of n-ary relationships, the key of this new entity is the concatenation of the keys of the entities which participate in the relationship and which are not in Functional Dependency (FD) with respect to the other entities (the key of the FD entity becomes a simple property).
Example: Binary relationship (x,n - y,n)
The relationship PRICE becomes a logical entity with the key of the entities ITEM and SUPPLIER as its key (Item_Code and Supplier_Code).
Example: N-ary relationship with a FD entity
The relationship SUPPLIED_FROM becomes a logical entity with the key of the entities CUSTOMER and ITEM as its key (Customer_code and Item_code). The key of the entity STORE (Store_No) is duplicated as a property of this new logical entity.