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Why did God create a world? Was the act of creation for some profit, or did God in His grace create world only because it was good?

Genesis 1 (KJV)
And God called the dry land Earth; and the gathering together of the waters called he Seas: and God saw that it was good.

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2 Answers

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You've got to read into the deeper meaning of things in order to understand why the world was created.

Colossians 1:16 (NIV)

For in him all things were created: things in heaven and on earth, visible and invisible, whether thrones or powers or rulers or authorities; all things have been created through him and for him.

Romans 11:36 (NIV)

For from him and through him and for him are all things. To him be the glory forever! Amen.

All things, in heaven and on earth were created for Christ. I like to think of this as gifts. We are literally gifts from God the Father to God the Son.

We were made to serve Him.

Revelation 1:6 (NIV)

and has made us to be a kingdom and priests to serve his God and Father—to him be glory and power for ever and ever! Amen.

Jesus created this world complete with all of it's suffering so that He could show us how much that He loved us.

Luke 7:47 (NIV)

Therefore, I tell you, her many sins have been forgiven—as her great love has shown. But whoever has been forgiven little loves little.”

We can also learn from the commandments why this world was created. As the first commandment is to Love God. And the second is like it, to love everybody around us, all of the law and all of the prophets hang on these two commands.

I believe that God created this world and allowed us to fall so that we could learn to Love, because He first showed His love for us.

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We don't know!

Unfortunately, the Bible doesn't tell us why he created the world, simply that he did create it.

Lonely
One speculation (and it is pure speculation) is that he created the world in order to have other beings with free will that would love him. We can see this in the fact that there are things we can do to please God. From that concept, we can expand it a bit to assume that the things he finds pleasing is the reason that he actually created us. So, in essence, the speculation is that he created us so that we could love him and choose to follow him.

Self-glorification
Another theory (eg speculation) is that he wanted to bring glory to himself. The argument goes that all created things reflect God's glory (per Psalm 19:1 for example), in particular mankind (per Genesis 1:26); since the creation reflects His glory, then he must have created them for the purpose of reflecting his glory.

The problem with these theories is that they use the process of logical induction to come to these conclusions. In fact these thoughts are a very weak induction. It's like saying "I've only seen a green frog, therefore all frogs must be green."

These theories attempt to attribute thoughts to God based on our understanding of his creation. This, in my opinion, is a very dangerous road.

Summary (TL;DR)
We don't know why God created the world because he never told us. We do have ideas including the two I mentioned above. However, these ideas, as I mentioned, are pure speculation and we must be careful not to presume that we know the mind of God.

Isaiah 55:8 NWT
“For the thoughts of YOU people are not my thoughts, nor are my ways YOUR ways,” is the utterance of Jehovah.

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Remind me next week to answer with a rebuttal. Of course we don't know all the details but we have some good clues. It's about glorifying himself and his son. –  Caleb Sep 22 '11 at 21:12
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