How are the Color Channels Multiplied?

In the shader settings If the Diffuse external Image Color Map has red color of saturation 255 which is 255,0,0 and the color from the picker has a value of 0.5,0.5,0.5 or Gray(128,128,128) then how does the multiplication takes place?
is it  R(R,G,B).G(R,G,B),B(R,G,B) or (R*R,G*G,B*B) this has been bothering me for some time now.

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