I'm having a hard time with the revised regression equation for the case of continuous change in the inflation rate using the square of the calendar year as an additional explanatory variable.  Can anyone help with this? 

For the discrete change in inflation rate I'm able to see how

x₂ = X₂-D(X₂-9)

x₃ = D(X₂-9) (*note there is a typo here in the sample project)

so that x₂ +  x₃ = X₂ ,

but I'm not sure how to apply this logic to the continuous case.

[NEAS: Suppose the inflation rate Y = X, where X is the year index.  The cumulative effect of inflation on loss costs is 0.5 X².  This assume continuously compounded rates, so we add the inflation rates in each period.]