Here is the strategic form game:
Player 2
Left Middle Right
Top 2,2 0,0 1,3
Player 1 Middle 1,3 3,0 1,0
Bottom 3,1 2,3 2,2
First I performed an IDSDS and deleted Player 1's "Top" strategy since it is strictly dominated by the "Bottom" strategy. The resulting game is as follows:
Player 2
Left Middle Right
Player 1 Middle 1,3 3,0 1,0
Bottom 3,1 2,3 2,2
Let p denote the probability that Player 1 will choose Middle.
Let r and s denote the probability that Player 2 will choose Left and Middle, respectively.
Now here's my first problem. When I try to equate the expected payoffs of Player 2 choosing Left, Middle, and Right, I can't derive any values:
$
3p + (1-p) = 3(1-p) = 2(1-p)\\
$
There is so such value for p here.
Moving on to expected payoffs of Player 1, I run into another problem:
$ r + 3s + (1-r-s) = 3r + 2s + 2(1-r-s)\\ s = 2r + (1-r-s)\\ r = 2s - 1 $
But now I am unsure of how to find the values of r and s.
Where am I going wrong?
Player 2 cannot lose if he were to choose
Middlestrategy instead ofRight. However, you correctly didn't removed it, because it is not dominated strictly. On the other hand, since the probability $p$ that first player will chooseMiddlestrategy is not $100\%$, then maximizing expected payoff for the second player, you can set $r+s = 1$, that is discard theRightstrategy. Please note that this is ok only because $p \neq 1$ (and we know that $p \neq 1$ because this game does not have pure Nash equilibrium).What we are left with is a standard $2\times 2$ game that you can solve easily (if you don't know how, then google "calculate 2x2 mixed equilibrium" or something similar, the available texts are much better than anything I could write here). We have
$$ \begin{aligned} EP_1 &= 1\cdot pr + 3\cdot (1-p)r + 3\cdot p(1-r) + 2\cdot(1-p)(1-r) \\ &=-3pr+p+r+2 \\ &= (-3r+1)p + (r+2) \\ EP_2 &= 3\cdot pr + 1\cdot (1-p)r + 0\cdot p(1-r) + 3\cdot(1-p)(1-r) \\ &=+5pr-3p-2r+3 \\ &= (+5p-2)r +(-3p+3) \end{aligned} $$
so $r = \frac13$ and $p = \frac25$. Once again, this game has no pure Nash equilibria, therefore if $r \neq \frac13$ then $p = 0$ or $p = 1$ and then $r = 0$ or $r = 1$ which leads to contradiction; similarly $p \neq \frac25$ cannot be true.
Hope that helps :-)