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This option allows you to move an object in the stack up only one layer. The layers effected by the move will automatically shift to their appropriate layer.
Each object is an entire layer across the canvas. One object might look like it is directly on top of another object but their layer numbers might be more than one layer apart.
Also, grouped objects are on the Same Layer.
How to raise object up one level
Example

In this example, the square was selected and raised once.