Possible States / Residues:
The initial state corresponds to the empty string ϵ, whose product modulo 7 is 1.
Since Σ={1,2,3,4} and 7 is prime, we consider the reachable residues in Z7×={1,2,3,4,5,6}:
From state 1:
1×1≡1
1×2≡2
1×3≡3
1×4≡4
From state 2:
2×3≡6
2×4≡8≡1
From state 3:
3×4≡12≡5
Thus, all 6 non-zero residues {1,2,3,4,5,6} are reachable from the start state 1.