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DR, or Damage Reduction, is a passive mechanic that just reduces all damage you take by a percentage. Multiple sources of DR stack, but the effectiveness diminishes as you gain more, as in you don't gain as much DR from further sources the more DR you have.
No thats barrior, its something else, there is no DR bar.
It's diminishing, because for example, simple 20 DR already lowers damage down to around 84%, which is huge for just one item. Using some simple graphs, it's not hard to see how efficient DR becomes the more you have it. if we take items that reduce incoming damage by flat amount, they apply first.
example: slime damages player for 35 damage. let's say we have 7 flat damage reduction and 40 DR. it means first it is lowered to 28, and then multiplied by 5/7, or around 70%, down to 20 damage.
Hope it will help everyone who reads this message