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The covenant of grace is that time that started with the death and Resurrection of Jesus Christ and stops at his second physical coming. The convent of grace implies that God will judge every individual according the choice made during lifetime so three ways of judgment stand during this convent.

first we have the ones that accept Jesus Christ as saviour and Lord; and thus their names are written in the book of life (revelations). they will be judged according Christ's accomplished work on the cross. automatically they are saved by grace. (Jesus paid their penalty)

secondly we have those who never heard about Christ. they will be judged (according revelation) by their personal book of works. if their works are good enough God will make his final judgment (problem with this is that all are sinners, and all spoil God's glory). accordingly they will be given a second chance, yet this chance is given through the law that does not save, rather the law shows us our trespasses. the law (10 commandments) makes it practically impossible to be saved

thirdly here are those who heard about, yet rejected Jesus Christ entirely, they are already condemned (according the gospels)

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