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Butter is an example of ___________ whereas milk is _________ emulsion.
$1.$ oil in oil; water in water
$2.$ water in oil; oil in water
$3.$ oil in water; water in oil
$4.$ water in water; oil in oil
Select the correct one from above four options:

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Answer
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Hint:Emulsions are those mixtures that have two or more types of liquids where, one is of droplets or tiny or even ultramicroscopic in size, which is expanded throughout each other.Emulsions are defined as a colloid that contains two or more non-homogeneous types of liquids where one of the liquid has the dispersion of the different forms of liquids.

Complete step by step answer:
It basically contains a dispersion of two liquids which are immiscible with each other. One of the liquids works as the dispersion medium and the other as the dispersed phase.
Based on their properties in the dispersed phase and the dispersed medium they are classified into two categories (a) oil in water (b) water in oil.
In the case of oil in water emulsions, oil is the dispersed phase and the water is the dispersed medium. An example of oil in water emulsion will be milk. In the case of milk, the fat globules act as a dispersed phase that are suspended in the water.
In the case of water in oil emulsions, the roles get switched. Oil is the dispersed medium and the water is the dispersed phase. An example of water in oil emulsion will be butter.
Hence, Butter is an example of water in oil whereas milk is an oil in water emulsion.

Therefore, option $2$ is correct.
Note:
The appearance of emulsions are cloudy in appearance due to many phase interfaces scattering light which passes through the emulsions. They appear in white when the dispersed light is in equal proportions. They also show the Tyndall effect.