A trader cheats at both ends. Buying, he pays for 1 kg but takes away 1080 g; selling, he charges for 1 kg but hands over only 900 g. He buys and sells at the same rate per kilogram. His overall gain percent is:

Take the rate as ₹1000 per kg. He spends ₹1000 and holds 1080 g; selling that stock at 900 g for every ₹1000 charged brings in $1080/900\times 1000$ = ₹1200, a gain of ₹200 on ₹1000, i.e. 20%. Adding the two cheats (8% while buying, 10% while selling) to get 18% is wrong because the selling cheat acts on the enlarged 1080 g; and 180/1080 = 16.67% measures the surplus against the goods instead of against the money spent. Cheating on only one side would have gained 8%.