.02*.02 gives you the probability that the first two tires you look at are both defective. You haven't specified what happened with the other two tires - they could be good it they could be bad. But if you're calculating the probability that exactly two are bad then you can't allow the other two to be bad. You also don't Account for how many ways there could be two bad tires. It could be the front two. It could be the back two... And so on. Hopefully this helps you understand some of the shortcomings of your answer