 Solution

For a single read-only memory implementing both the next-state and output equations, the address has four request bits plus three present-state bits. Each word contains three next-state bits and four grant bits. HenceThree D flip-flops store the state outside this combinational ROM. This is the direct truth-table implementation for the encoding above. A smaller factored implementation exploits the independence of the next-state equations from $V$: a $64\times 3$ next-state ROM and an $8\times 4$ output ROM use $224$ stored bits in total, or the output decoder can be ordinary logic. These are different implementation organizations, not different state counts.