False

Explanation:
There is an inverse relationship between the price of bonds and interest rates. When interest rates rise, bond prices generally fall, and when interest rates fall, bond prices generally rise. This relationship is known as the interest rate risk.

Reasons for the Inverse Relationship:
The inverse relationship between bond prices and interest rates can be explained by the following factors:

1. Opportunity Cost: When interest rates rise, new bonds are issued with higher coupon rates, offering investors better returns. As a result, existing bonds with lower coupon rates become less attractive, causing their prices to fall.

2. Discounted Cash Flow: Bond prices are influenced by the present value of future cash flows, which are discounted using the prevailing interest rate. When interest rates rise, the discount rate used to calculate the present value increases, reducing the price of the bond.

3. Market Demand: When interest rates rise, investors can earn higher returns from other investments with lower risk. This reduces the demand for existing bonds, leading to a decrease in their prices.

4. Inflation Expectations: When interest rates rise, it often indicates expectations of higher inflation. Inflation erodes the purchasing power of future bond payments, making existing bonds less valuable and causing their prices to decline.

5. Duration: The duration of a bond measures its sensitivity to changes in interest rates. Bonds with longer durations are more sensitive to interest rate changes and experience larger price movements.

Conclusion:
In summary, the price of bonds is inversely related to interest rates. When interest rates rise, bond prices tend to fall, and when interest rates fall, bond prices tend to rise. This relationship is driven by factors such as opportunity cost, discounted cash flow, market demand, inflation expectations, and duration.