With the brackets fixed I get the expected results in perl 5.8.7 and 5.6.1, with no need for a ctl-Z. Here's the test code I used, with the bracket corrected.

my @attributes = qw(first second third);
attrib_type();

sub attrib_type {
    foreach $value (@attributes){
      print "Is $value an attribute (y or n)?  ";
      $response = <STDIN>;
      chomp($response);
      if ($response =~ "y" || $response =~ "Y"){
         print "response is $response\n";
         print "configure as an attribute\n";
      }
      else {
         print "response is $response\n";
         print "configure as a parser\n";
      }
   }
}
[download]