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Background: Drop Shadow is an effect where an image is repeated behind itself to create the illusion that the image is floating over its background. In QuarkXPress, you can use “Item Knocks out Drop Shadow” feature to prevent a shadow from displaying through semi- opaque areas of an item.
Select the first text box again and go to drop shadow in the measurement palette and check-mark “Item knocks out Drop Shadow”.
Once applied the first text box will knock out its drop shadow and the actual cyan color of the second text box will be visible.