Do interest rates create inflation?

go back to 101,all wrong.

You might want to reconsider the definition of inflation. Inflation is generally defined as the increase in prices, not the increase in money supply. If I printed a billion dollars and buried it in your backyard are you going to say 'inflation has increased?' No, Of course not. You would have to dig up the money and then spend it somewhere for it to have any possible effect on the economy worth discussing.

The economy is far more complicated than the model you proposed. Money is also created when you sell something to the bank, when banks create their own money (through shadow banking and financial techniques), when the government spends in the economy. Money is also destroyed when you pay back loans or pay taxes to the government or if you drop your 100$ bill into the sewer. So what happens if the banks loan out money and the government mints money to pay someones welfare cheque and the welfare cheque is more than the interest owed on debt?

This assumption is precisely correct that is why EVENTUALLY the currency will fail when hyperinflation takes hold because there is noway to pay down the debt as there is interest to be paid on an ever increasing money supply thus making the debt essentially infinite or at least finite to the reliable life of the currency then we'll... again EVENTUALLY have to adopt another type of currency.

The best way to increase the money supply....put every able bodied American to work!

Personally, I believe it does has something to do with inflation, just not sure why. People lose their money while there are interest rates. Oh, I get it. It may have something to do with it, but it surely doesn't cause it directly. There are many other factors you should consider before saying this statement is true.
Interest rates are from banks, which means when people borrow money, the rate goes up. Provided more people start borrowing money, interest rates would increase. But as for inflation... Price goes up, leading to inflation. I have little knowledge on that. Hope this gives you some clue in answering the question.

The other way around.

No. Banks have assets other than money. Interest money can be repaid as gold or other precious commodities. So no need to reprint more money.

Interest-rates are part of a much larger economic 'chain', so they could be used to create inflation, they could also be used to reduce inflation.

In your case, the person doesn't need QE necessarily(the FED printing more money, to cover the interest), the person just needs to earn money.