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notify() method moves a thread out of the waiting pool to ready state, but there is no guaranty which thread will be moved out of the pool. 

No. 

When a Thread calls the sleep() method, it will return to its waiting state. When a Thread calls the yield() method, it returns to the ready state. 

Daemon is a low priority thread which runs in the backgrouund. 

We should call setDaemon(true) method on the thread object to make a thread as daemon thread. 

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