He started with 7 eggs. He sold 4 (=7/2 + 1/2) to the 1st neighbour, 2 (=3/2 + 1/2) to the
second and his last egg (=1/2 + 1/2) to the third neighbour.
Still, I don't know what his neighbours were doing buying 'newly hatched eggs' (does this
mean they just bought the remnants of the shell, or the chick as well?).