So once we have the mask where we want it we can turn it to a selection by clicking the icon as shown, or dragging the #4 onto the icon. Now the selection is active. Then double-click on the BACKGROUND LAYER bar in the Layers Pallete. Now the selection is active on the layer and not on the #4 channel as seen. This is important, otherwise you are just selecting on the mask.

You can now copy and paste so the figure is duplicated onto a new transparent layer. If you don't want a second layer, by the way, double-click again on the background layer bar. This will open up a dialog box to rename the layer, and afterwards will turn the layer into a transparent layer. If all you did was invert the selection and hit DELETE it would erase the background around the figure, but the background and figure would still be on the same layer.
 

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