Which economist believes all profits are linked with uncertainty and risk? (LO6, 7) a) Frank Knight c) Karl Marx b) Joseph Schumpeter d) John Maynard Keynes

It is crucial to know that this question relates to the theories proposed by various economists. Each economist listed provided significant contributions to economic theory and they each have their unique views on the relationship of profit, risk, and uncertainty.

a) Frank Knight: Frank Knight is a prominent economist who made a clear distinction between risk and uncertainty in his economic theory. According to him, all profits are associated with uncertainty, not the risk. He argued that uncertainty, unlike risk, is immeasurable since outcomes are unknown and therefore cannot be objectively quantified. b) Joseph Schumpeter: Schumpeter’s theory emphasizes the role of the entrepreneur as the disruptor of economic equilibrium through the mechanism of innovation. However, Schumpeter does not directly link profits with uncertainty and risk. c) Karl Marx: Marx's theory of profit does not directly associate profits with uncertainty and risk. His perspective on profits largely hinges on surplus value generated by the exploitation of labor. d) John Maynard Keynes: Keynes’s theories place significant emphasis on aggregate demand in determining economic activity. He, however, does not specifically associate all profits with uncertainty and risk.

After comparing the theories proposed by each economist, it becomes clear that Frank Knight is the one who argued that all profits are associated with uncertainty, rather than risk. Hence, the correct answer is (a) Frank Knight.