In order to find the product, we first multiply 2 by 5.
We have, 2 × 5 = 10
Now, 0.02 has 2 decimal places and 0.05 has 2 decimal places.
The sum of the decimal places is 2 + 2 = 4.
So, the product must contain 4 places of decimals.
∴ 0.02 × 0.05 = 0.0010 = 0.001
Hence, the correct answer is option (c).