(a) On 18th May 2015, Marks & Spencer announced to buy back (up to) 150 m of its own shares from London Stock Exchange. On the day of announcement, Marks & Spencer's share price increased by 1.75%. On the same day, the UK market return was 0.12% only. Explain the possible reason(s) of such a market reaction to Marks & Spencer's share repurchase announcement. [12 marks] (b) Company ABC is listed in Stock Exchange. It had very stable earnings and dividend payout ratio (50%). Due to Covid-19, company ABC just made a very small earning in 2020. However, it increased dividend payout ratio to 95%, making no change of total amount of dividend payment in 2020. Explain the possible motivations and rationality of company ABC's dividend policy in 2020. [13 marks]