Converting Moore to Mealy number of states does not change
But when Converting mealy to Moore number of states increased and increased by N * M , (Where Initial Mealy machine with N states and output of Mealy is M) then Final Moore machine may contain (N * M) number of states (in the worst case N * M number of states Reached in Moore Machine )
So if you consider worst case Answer Would be FALSE.
Hence option B should be Correct.