We can pick the 1st digit any of these 5 ways:
1, 2, 3, 4 or 5
That's 5 ways to pick the 1st digit.
For each of those 5 ways, we can pick the 2nd digit any of these 5 ways:
1, 2, 3, 4 or 5
That's (5)(5) or 25 ways to pick the 1st and 2nd digits.
For each of those 25 ways, we can pick the 3rd digit any of these 5 ways:
1, 2, 3, 4 or 5
That's (5)(5)(5) or 125 ways to pick the 1st, 2nd, and 3rd digits.
For each of those 125 ways, we can pick the 4th digit any of these 5 ways:
1, 2, 3, 4 or 5
That's (5)(5)(5)(5) or 625 ways to pick the 1st, 2nd, 3rd, and 4th digits.

Edwin