When cash is deposited in a chartered bank, the bank makes new loans. This,

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When cash is deposited in a chartered bank, the bank can use a portion of it to make new loans, which increases the total volume of deposits (and therefore M1+) within the banking system. This is because the deposit made is considered a liability of the bank and is used as a basis for creating a new loan, which is an asset for the bank. The creation of new loans thus expands the money supply, leading to an increase in M1+.

When Cash Is Deposited in a Chartered Bank, the Bank