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tracedef
Yes, that is correct. That's what Dave meant by the first part of his answer, "You'll boot from the backup drive itself." And yes, you then just restore by cloning the external backup (from which you are booted) onto the new internal drive.
As Dave said, see the User Guide. The ONLY gotcha is that with the new drive, before cloning to it you must make sure it is partitioned and formatted like the old one was, that is, appropriately for the model of Mac you are using. The cloning from your backup WILL NOT automatically take care of that. The User Guide also covers this, or there are a lot of recent posts here about proper partitioning (even if you are only using one partition) and formatting. You do this partitioning and formatting while booted from your backup.
Good luck.
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