We use Faraday's law of electromagnetic induction, which states that the induced emf is given by the rate of change of magnetic flux through the loop:
\[
\mathcal{E} = - \frac{d\Phi}{dt}
\]
where \( \Phi = B A \cos(\theta) \) is the magnetic flux.
Here, \( B = 0.4 \, \text{T} \), \( A = (0.50)^2 \, \text{m}^2 = 0.25 \, \text{m}^2 \), and the angle \( \theta \) changes from 0° to 60°.
We can calculate the change in flux \( \Delta \Phi \):
\[
\Delta \Phi = B A (\cos(0^\circ) - \cos(60^\circ)) = 0.4 \times 0.25 \times (1 - \frac{1}{2}) = 0.4 \times 0.25 \times 0.5 = 0.05 \, \text{Wb}
\]
The time taken is \( \Delta t = 0.2 \, \text{s} \). Therefore, the induced emf is:
\[
\mathcal{E} = \frac{\Delta \Phi}{\Delta t} = \frac{0.05}{0.2} = 0.25 \, \text{V}
\]
Thus, the induced emf is 2.5 V.
Final Answer: (C) 2.5 V