Rudolph, the red nosed reindeer, is always indifferent between 3 candy canes (C) and 2 gingerbread cookies (G)

The answer is (A).

First note that the preferences of Rudolph is perfect substitute. Therefore, the consumer will always spend all the income on a good that provides a higher utility per dollar spent.

Initially, the price for both candy cane and gingerbread cookies is 2. So to buy 3 candy canes will cost 6 dollars and to buy 2 gingerbread cookies will cost 4 dollars. Since Rudolph is always indifferent between 3 candy canes and 2 cookies, and 2 cookies cost less than 3 candy canes, Rudolph will spend all the money on cookies and buy 0 candy canes.

Now the price of candy canes drops to 1. To buy 3 candy canes will cost 3 dollars and to buy 2 gingerbread cookies will cost 4 dollars. This time, Rudolph will spend all the money on candy canes and buy 10/1 = 10 candy canes with an income of 10.

So the total change in demand for candy cane is 10 - 0 = 10. Since the preferences are perfect substitutes, the entire effect is due to substitution effect and there is no income effect.