The second caller hears the normal ringing, not the busy signal.
To answer the second caller
At the sound of the beep, quickly push the receiver button on your phone. (If you do not answer the second caller immediately, you will hear a final beep ten seconds later.) Pushing the receiver button also lets you switch from one caller to the other.
If you are having a three-way conference call, you will not hear the call waiting beep, and the person trying to reach you will hear a busy signal
If you have also subscribed to a voicemail service, you can ignore the call waiting beep and let the call go into voicemail
Hang up and wait for the ringing
Now pick up to speak to the second caller