"It has tasty milk."
Translation:יש לזה חלב טעים.
Apparently you can use לה or לו for animals but for inanimate objects you have to use לזה or לזות. English speakers should find this easy as most people have pets that are refered to as "he" or "she". In this particular question, knowing that only female animals give milk, if the choice is between לו and לזה , both of which are male, then you have to choose the version which is for an inanimate object, and not for an animal.