Board Thread:Wiki discussions and announcements/@comment-1990160-20140521040036/@comment-1330314-20140523171459

Deshiba wrote: This is an incorrect statement. Armor does not increase your health, it reduces incoming damage by a percentage. If you hover your armor stat in game it will plainly tell you: "Reduces incoming physical damage by xx%". As for any multiplicative calculation, there's going to be diminishing returns, where buying more of it will increase the effect less and less.

No it's not. I may, however, not have explained myself clearly. What I'm referring to is the concept of effective hit points, the amount of damage of a certain type required to kill you. Here's how it works:

Suppose you have 1000 health, 0 armor and 0 magic resist. Ignoring health regen and the like, it takes 1000 damage to kill you, of any type.

Now suppose you have 1000 health and 100 armor. Because 100 armor provides 50% damage reduction, every point of physical damage dealt to you is halved, so it is the equivalent of having 2000 health against physical damage.

Now, suppose you then have 1000 health and 200 armor. Because 200 armor provides ~66.7% damage reduction, every point of physical damage dealt to you is reduced by one third, so it is the equivalent of having 3000 health against physical damage.

If you notice, the damage reduction falling off gives you the illusion of diminishing returns, but in reality 1 point of armor increases your health against physical damage by 1% regardless of how much armor you've built. Since it's these effective hit points, or EHP, that determine how much damage the enemy needs to deal to kill you, it's EHP that prevails. There are no diminishing returns to armor or MR.