To add a bit of detail to what Sockboy has said (based on older comments by Riley which may have changed some):
- Decrease, however it isn’t a strict 50 50 for two players in a party or 20 20 20 20 20 for a 5 player party. It is something like 80 80 for 2 players in a party or 40 40 40 40 40 for a party of 5. This is there to encourage party play.
3/4. Both groups get loot. However, between separate parties the drop rate is split depending on damage done. If two players not in the same group do 60% and 40% damage respectively the drop rate will be cut from the whole to 60% and 40% of the original drop rate. This also applies to if a single player does 50% and a group of 5 does 50%. The single player would get 50% of his initial drop rate and the party of 5 would get 50% of their 40 40 40 40 40.
If that makes sense. The numbers are arbitrary and inaccurate. I’m just using them as an example.
Riley has said he isn’t going to divulge the way luck currently works at this time as he hasn’t decided this is the final way luck will work in the game. Currently it’s safe to say it increases drop rate for items off mobs and chances you will catch 2 fish on one cast (edited: ty Rickness)
Also take note that on some mobs in game you have a roll chance on each item the mob drops so in some scenarios you could get lucky and receive one of each drop it offers. I think this has changed for drops tied to chests.