If God is Merciful, then Why is there Hell?

In Holy Quran Allah Almighty says about the hereafter life in these words: “See how We have bestowed more on some than on others; but verily the Hereafter is more in rank and gradation and more in excellence” (Quran, 17:21). Whoever does good deeds in this life will enter in Jannah and the wrongdoers will enter in Jahannam. We should try to do good deeds in this life so we will enter into Heaven in the hereafter.