You have 1000 base damage and “10% reduced damage” from gear and “10% reduced damage” from passives. You can then choose between slotting either of two support gems:
Gem
Gives
Calculation
Gem A
10% reduced damage
gear+passive+gem = 30% reduced, so 1000*(1-0.3) = 700 damage
Gem B
10% less damage
(gear+passive)*gem = 20% reduced and 10% less, so 1000*(1-0.2)*(1-0.1) = 720 damage
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Flat, additive and multiplicative stats
Flat stats usually use a form of the the word add. They stack additively with other flat stats of the same scope. Resistances are flat stats which use the word increased and are represented as percentages, and so are notable exceptions to the general rules.
Additive stats are usually percentages and use forms of the the words increase or reduce. They are summed with other additive stats of the same scope.
Multiplicative stats are usually percentages and use forms of the words more or less. They stack multiplicatively with other multiplicative stats of the same scope. A multiplicative stat’s internal ID can usually be identified by the suffix “_final”.
What this means in plain English is that you add the various “increased”/”reduced” effects together into a single multiplier, and multiply the base stat by the result, whereas you multiply the base stat by each “more”/”less” effect in turn.
The total stat value can be calculated as the sum of any added stat, multiplied by the sum of all increases and reductions to stat, multiplied by all more and less stat modifiers.
Order of application
Stats are only applied once per calculation. The usual order of application is: