The case for imputed righteousness
Imputed righteousness is the Protestant solution to a "divine predicament." On the one hand, God is infinitely merciful, "not wishing for any to perish, but for all to come to repentance." (2 Peter 3:9). On the other, God is infinitely holy and just, which means that he cannot approve of or even look upon evil (Habakkuk 1:13), neither can he justify a wicked person (Prov. 17:15). Because the Bible describes all men as sinners and says that there are none who are righteous (Rom. 3:23, 10), these two "competing" traits in God's nature appear to put him in a dilemma.
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