health care inflation rate

CFA Level II FRA
#1

In the textbook, it says that the presumption is that the health inflation rate will taper off and eventually become a constant. May i know the meaning of “taper off”? Does it mean increasing trend and become a constant gradually or decreasing trend and become a constant gradually? i checked dictionary and it says it means “weaken” but i still cannot get the graph in my mind after checking the dictionary.

thanks!

#2

I believe it means increasing trend and become a constant gradually. If the year that the ultimate healthcare trend rate (the constant) is pushed back, the PBO increases. This can only be possible if it’s an increasing trend.

#3

It could be either direction - a gradual return towards normal.

Thumbs up to all the non-native English speakers. #respect for taking the exam