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→Defense vs. Armor vs. Resistance
While Defense does increase when your character levels up, the Defense formula has built-in penalties for leveling up which counteract the Defense bonuses. For the most part, this means that Defense bonuses from level-up are largely superficial.
In terms of damage reduction, +3 Defense, +50 armor, and +5 resistance all give the same damage reduction to their respective damage types, however, mixing Defense with armor or resistance gives greater overall reduction than any one of them on its own.
==Development==