The required circle can be drawn as follows.
Step 1 : First, open the compasses for the required radius 4 cm.
Step 2 : Mark a point ‘O’ where we want the centre of the circle to be.
Step 3 : Place the pointer of compasses on O.
Step 4 : Turn the compasses slowly to draw the circle.
Step 5 : Now, open the compasses for 2.5 cm.
Step 6 : Again put the pointer of the compasses on point ‘O’ and turn the compasses slowly to draw the circle.