The motion of the block is simple harmonic motion (SHM), and the maximum speed of the block is given by:
\[
v_{{max}} = A \omega
\]
where \( A \) is the amplitude (maximum extension), and \( \omega \) is the angular frequency of the SHM.
The angular frequency \( \omega \) is related to the spring constant \( k \) and the mass \( m \) of the block by the equation:
\[
\omega = \sqrt{\frac{k}{m}}.
\]
Given:
- \( k = 500 \, {N/m} \),
- \( m = 50 \, {g} = 0.05 \, {kg} \),
- \( v_{{max}} = 3 \, {ms}^{-1} \).
First, calculate \( \omega \):
\[
\omega = \sqrt{\frac{500}{0.05}} = \sqrt{10000} = 100 \, {rad/s}.
\]
Now, using the maximum speed equation:
\[
v_{{max}} = A \omega,
\]
substitute the known values:
\[
3 = A \times 100 \quad \Rightarrow \quad A = \frac{3}{100} = 0.03 \, {m}.
\]
Thus, the length of extension \( A \) is \( 0.03 \, {m} = 3 \, {cm} \).
Thus, the correct answer is option (D), 3 cm.