Which narrative perspective is characterized by a narrator who is outside the story and knows the thoughts of all characters?

The narrative perspective described is known as third-person omniscient. This viewpoint allows the narrator to possess an all-encompassing knowledge of the story, which includes insights into the thoughts, feelings, and motivations of all characters rather than being limited to just one. This omniscient viewpoint enables a deeper understanding of the plot and character dynamics, as readers can see multiple perspectives and experiences within the narrative.

In contrast, the first-person perspective is limited to the narrator's own experiences and thoughts, thereby restricting the reader's understanding to that singular viewpoint. The third-person limited narrative only provides access to the thoughts and feelings of one character, creating a more constrained view of the story. The second-person perspective directly addresses the reader as "you," creating a unique but less common form of narrative that doesn't align with the idea of insight into multiple characters. Hence, third-person omniscient is the most accurate description of a narrator who can articulate the thoughts and emotions of all characters present in the story.