Acharya Prashant explains the concepts of the knower, knowledge, and the known based on the Ashtavakra Gita. He defines the 'known' as anything the mind can cognize or perceive, the 'knower' as the internal entity attempting to understand, and 'knowledge' as the relationship between the two. He observes that the ego typically attaches itself to the knower, becoming dependent on the known objects of the world. This dependency leads to slavery and inevitable suffering because worldly objects are transient and cannot provide lasting satisfaction. When the ego identifies with the process of knowing, it becomes entangled in the play of nature, leading to anxiety and disappointment.