I agree with you it could be a mistake in the question, the displacement would become less if the object was falling back down towards the ground
I do think the solution is right.
The displacement is the difference in the position of two marks. In the question they ask the “displacement covered every second” and not the overall displacement (between you and the object)
The displacement D between 2 points is : D = (velocity)x(time)
Here our time is imposed : 1 second
So we have : D = (velocity)x(constant)
D varies proportionally with the velocity as it moves.
The object slows down while going up, so :
Velocity near the peak < velocity near the bottom
Which means :
D near the peak < D near the bottom
The displacement covered by the object is less every second it travels upward.