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Earth behaves as  a magnet because there is a large amount of Iron in the form of hot liquid inside Earth underneath the surface.  There is movement of free electrons inside that iron liquid. That causes circular currents in loops and that in turn causes magnetic field effect. 

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Earth behaves as a magnet because there is lot's of amount iron and lava  kept under the earth which attract the things from space. that's why meteorites were fall in the earth because irons attract them from inside.  
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