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The term that best defines the common preferences within a community regarding physical activities is community norm. This term captures the shared expectations and behaviors that are prevalent within a specific group or community, including the types of physical activities that are favored or practiced collectively. Community norms are shaped by various factors, such as cultural beliefs, traditions, and social values, which influence how physical activities are perceived and engaged in by community members.

In contrast, institutional policy refers to formal guidelines established by organizations and institutions, which do not inherently reflect the preferences of the community. Cultural identity encompasses the shared characteristics of a group, including traditions and values, but it is more overarching than just preferences for physical activities. Generational trend pertains to patterns observed across different age groups, which may influence activity preferences over time but do not specifically encapsulate the community's collective preferences in the present moment. Hence, community norm is the most precise term for describing those common preferences towards physical activities.