First step is just to list out the states: we have 8 states (1-8), so list 1-7 on the x-axis and

2-8 on the y-axis:

2
3
4
5
6
7
8

1 2 3 4 5 6 7

Now, let’s take a look at what’s given:

present state next state output

I=o I=1 Z

1 1 5 1
2 5 3 0
3 6 2 1
4 7 6 0
5 1 3 0
6 8 7 1
7 4 8 0
8 6 2 1

Now let’s look for the equivalent states—remember that 2 states are equivalent if for
every input, they go to the same next state with the same output. From a glance, you can
tell that states 3 and 8 are equivalent because they have the exact same next state and
output:
present state next state output
I=o I=1 Z
……..

3 6 2 1
……..
8 6 2 1

So we can go ahead and mark states 3 and 8 as the same using an =:

2
3
4
5
6
7

=
8

1 2 3 4 5 6 7

Now look for the different states—2 states are different if for any input, they have
different outputs. For example, states 1 and 2 are different (because the output of state 1
is 1 and the output of state 2 is 0). Similarly, states 1 and 4 are different. States 1 and 5
are different, and so on.
What about states 1 and 3 you asked? The answer is DON’T KNOW YET because even
though states 1 and 3 have the same output=1, they have different next states (1,5) for
state 1 vs. (6,2) for state 3—so we will have to track them down later (as you will see).
For now, mark an X where you know for sure that the states are different:

X
2
3

X X
4

X X
5
6

X X X

X X X
7
8

X = X X X

1 2 3 4 5 6 7
See how it works!? Now we just need to figure out the remaining blanks! Let’s go back
to the unknown 1 and 3: well 1 and 3 would be the same if 1=6 AND 5=2, right? So we
can temporary put in the 1 and 3 square: 1-6,5-2 (note that this is just temporary!). We
can do the same for all the other blank squares:

X
2
3

1-6,5-2 X

X 5-7,3-6 X
4

X 5-1 X 7-1,6-3
5
6

1-8,5-7 X 6-8,2-7 X X

X 5-4,3-8 X 7-4,6-8 1-4,3-8 X

7
8

1-6,5-2 X = X X 8-6,7-2 X
1 2 3 4 5 6 7
That’s it! We’re almost done! We go to second round. As a start, let’s look at the 4 and 5
square which contains 7-1,6-3. We know from the X in the 1 and 7 square that 1 and 7
are different, so 7 cannot be the same as 1! Therefore we can cross this 4 and 5 square
out because 7-1 will NEVER be 7=1!

X
2
3

1-6,5-2 X
4

X 5-7,3-6 X
5

X 5-1 X X
6

1-8,5-7 X 6-8,2-7 X X

X 5-4,3-8 X 7-4,6-8 1-4,3-8 X

7
8

1-6,5-2 X = X X 8-6,7-2 X

1 2 3 4 5 6 7

I think you know what’s going on now: basically we iterative go through the process until
we determine whether each square is = or X. Let’s continue—we can also eliminate the 2
and 5 square because 5-1 will never be 5=1 (since there’s an X in the 1 and 5 square).
Likewise, we can eliminate the 5 and 7 square because 1-4 will never be 1=4 (since
there’s an X in the 1 and 4 square). We can also eliminate the 2 and 7 square because 5-4
will never be 5=4 (since there’s now an X in the 4 and 5 square):
 X
2
3

1-6,5-2 X

X 5-7,3-6 X
4

X X X X
5
6

1-8,5-7 X 6-8,2-7 X X

X X X 7-4,6-8 X X
7
8

1-6,5-2 X = X X 8-6,7-2 X

1 2 3 4 5 6 7

Now that the 2 and 5 suqare is X out, we can X out square 1 and 8 as well as square 1 and
3 because 5-2 will never be 5=2. Likewise, we can X out square 2 and 4 because 5-7 will
never be 5=7, and we can X out square 6 and 8 as well as square 3 and 6 because 7-2 (or
2-7) will never be = to each other:
 X
2

X X
3

X X X
4

X X X X
5
6

1-8,5-7 X X X X

X X X 7-4,6-8 X X
7

X X = X X X X
8

1 2 3 4 5 6 7

Now that there’s an X in the 1 and 8 square, we can eliminate the 1 and 6 square (because
it contains 1-8). Also now that there’s an X in the 6 and 8 square we can eliminate the 4
and 7 square (because it contains 6-8):
 X
22
33

X X

X X X
44

X X X X
55
66

X X X X X

X X X X X X
77
88

X X = X X X X

1 2 3 4 5 6 7

And we are done! Conclusion: 3=8 and nothing else. Therefore, we can substitute 3 for
8 and take out row 8:

present state next state output

I=o I=1 Z

1 1 5 1
2 5 3 0
3 6 2 1
4 7 6 0
5 1 3 0
6 3 7 1
7 4 3 0