Before Damage Calculation we must determine the Base Stats of the characters in question. Monsters and Heroes have Unweighted Stat Values. To determine their Base Stats, we multiply the Unweighted Stat in question by that Stat types Weight.
Weights:
The Damage Formula is as follows:
Damage = (Base Atk * Stress Mod * Morale Mod * Trait Mod * Special Mod) - (Base Def * Trait Mod * Special Mod)
Note that Heroes don't posses Stress, Morale, or Traits so all of these Values are 1 for Heroes. Special Modifications may come from the Room the Monster or Hero is in or some other source.
The Stress Mod is a damage penalty in the form of a multiplier between 1 and 0.25. The Stress Mod is calculated with the following formula:
This formula uses an exponential curve so that the player is not penalized for Monsters having a small amount of Stress but quickly becomes a problem when they hit a breaking point. This formula is piece-wise so that there is a maximum damage penalty that can occur to prevent Monsters from becoming completely ineffectual.
The Morale Mod is a damage bonus in the form of a multiplier between 1 and 1.75. The Morale Mod is calculated with the following Formula:
The Morale Mod uses an S-curve in order to reward the player for investing in keeping their Monsters' Morale high. It will begin to payoff after a significant enough amount of Morale is acquired, however it is not necessary to constantly maintain maximum Morale because the benefits taper off.