Step 1 :
The equation of the given circle is $x^2+y^2=25$
This can be written as
$(x-0)^2+(y-0)^2=5^2$-------(1)
which is of the form
$(x-h)^2+(y-k)^2=r^2$--------(2)
Comparing both the equations we get,
$h=0, r=0$ and $ r=5$
Hence the centre is (0,0) and radius = 5.
$ \therefore$ The distance between the point (-2.5, 3.5) and centre (0,0) is
$ d = \sqrt{(-2.5-0)^2+(3.5-0)^2}$
$ = \sqrt{6.25+12.25}$
$ = \sqrt{18.5}$
$ = 4.3
This distance is lesser than 5
That is less than the radius
Hence the point lies inside the circle.