Simple interest means the interest at the end of each year will always be 8% of 2000 (assuming he doesnt pay some of it off), and will not be compounded with the existing interest.
To get a percentage, multiply by the percentage/100, in this case i.e. multiply by 0.08. 2000*0.08 = $160. Therefore he has $160 of interest each year to pay. Now we just need to work out how many lots of 160 go into 640, i.e. divide through. 640/160 = 4 - therefore he has had the loan for 4 years.
