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but when it returns to source,i.e. panel, it uses the grounded conductor to return to earth,...right?

The source would never be a panel, the source would be a utility transformer, a generator, photo voltaic system etc.

If we are talking about a grounded system part of the current may flow through the earth (in and out) to get back to where the source is bonded.

Bob Badger
Construction & Maintenance Electrician
Massachusetts