My shots are not registering?

[RandumKiwi]

http://img137.imageshack.us/img137/3362/number3.png
Nothing damaged them knife grenade shotgun or pistol seen here ^^ I emptied all my magazine for the shotgun, a clip of the pistol mag. i knifed a lot threw three grenades nothing worked. Is this a bug that needs to be fixed?

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EDIT: They also couldn't see me? I lost 80 health from my grenade it bounced back, bad timing.

There's 2 ways to fix this:

a) Your graphic drivers are crap (the cause); you need to update them.
b) I've found that simply, changing your resolution in-game, fixes it most times. Once you open AC, go change the resolution to the same as your native resolution. If that doesn't work, try a smaller resolution (800x600).