generate e.g. circles on the fly with coordinates for postioning

Can php + what modules do this and has anybody succeeded to do something like the followingbefore? I want to generate simple images on the fly, e.g. a 50px circle on a transparent background of 200x200 px using php. I want to position the circle on the background using x and y coodinates. Is this possible with what php and additional tools? Thanks alot Helmut