Reinvesting sale proceeds across companies: A man sells 5,000 common shares of Company X (par $10, dividend 20%) at $30 each. He reinvests all proceeds in ordinary shares of Company Y (par $25, dividend 15%) priced at $40 per share. How many shares of Company Y does he purchase?

Introduction / Context:
This problem is about moving capital from one stock to another. The key is that the entire cash proceeds from selling the first holding are used to buy the second, at its given market price. Dividend rates and par values provide context but are not needed to count the shares purchased unless yield is asked.

Given Data / Assumptions:

• Company X sale: 5,000 shares at $30 each.
• Proceeds fully invested in Company Y.
• Company Y market price per share = $40.

Concept / Approach:
Total proceeds = number sold * sale price. Number of new shares purchased = proceeds / market price of the new shares.

Step-by-Step Solution:

Verification / Alternative check:
The dividend information is extra here; the count of new shares depends solely on prices and proceeds.

Why Other Options Are Wrong:
3,700, 3,800, 3,850, and 3,650 do not equal the exact division $150,000/$40.

Common Pitfalls:
Attempting to factor dividend rates into the share count; mis-multiplying proceeds or dividing by par instead of market value.

Final Answer:
3750