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IMO A

Moule’s review served as a welcome encouragement to the author: Hardy set to work with renewed vigor and finished the serial ahead of time.

Skeleton of the sentence : X served as Y <as a result of which something happened>

A) served as a welcome encouragement to the author: Hardy
Crisp, concise and the meaning is clear.
Correct

B) served a welcome encouragement to Hardy, and the author
This implies that review served something to Hardy - this is wrong.

C) was welcome as an encouragement to Hardy, the author
X was welcome as Y - incorrect usage.


D) was a welcome encouragement to the author, Hardy
Incorrect usage.
Who is the author - we are not clear.

E) served as a welcome encouragement to the author, Hardy
Abruptly joining two independent clauses.
Incorrect.
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Moule’s review served as a welcome encouragement to the author: Hardy set to work with renewed vigor and finished the serial ahead of time.

First we can come to 3:2 split with option C,D eliminated: Reason : elimination of verb Served which is essential to give meaning what / how moule's review impacted.
Out of A,B,E,
B is out for reason of change of meaning, Sentence means review served .... to hardy ,, preposition as is required to show how review served
B) served a welcome encouragement to Hardy, and the author

Between A and E

A) served as a welcome encouragement to the author: Hardy
E) served as a welcome encouragement to the author, Hardy

Colons usage is correct for the reason both statements independent make a meaning
E is wrong the usge of , comma, because first statement is not a modifier phrase or clause modifying the 2nd part of sentence. It is continuation and Cause -effect relation .

Answer A
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