We need to be certain that if we store an identifier for one entity in a relation representing another entity, the identifier never has a null value.
So, if both the entities participate fully, we just need a single relation representing both.
If one entity participation is optional, we need a separate relation for both the entities with the relation for the mandatory entity having a reference to the relation for the optional one (so that there is no NULL reference). This will be similar to an Employee - Manager relation where every Employer must have a Manager but a Manager may not have any Employee under him.
If participation of both the entities are optional, we need to have three relations - one each for the entities and a separate relation for the relationship having the primary keys of both the entities.
So, here only options B and C are correct.
Reference: MIT notes