[Solution by Dr. Abubacker] At maximum speed friction acts down the slope: $N\sin\theta+\mu N\cos\theta=\frac{mv_0^2}r$ and $N\cos\theta-\mu N\sin\theta=mg$. Dividing: $\frac{v_0^2}{rg}=\frac{\tan\theta+\mu}{1-\mu\tan\theta}$, so $\mu=\frac{v_0^2-rg\tan\theta}{rg+v_0^2\tan\theta}$. Answer (3).