Final answer:
The process of grouping individuals within institutions based on their age is known as age stratification, which categorizes people hierarchically.
Step-by-step explanation:
The process of grouping individuals within social institutions on the basis of chronological age is called age stratification. This concept involves the hierarchical system where different age groups may be valued differently within societies. Institutions often enforce this stratification through policies and norms that mandate distinct roles, responsibilities, and social expectations based on age, such as when children must attend school or when adults enter retirement.