Virtual images are formed by diverging rays.

Answer

**Step-by-Step Solution:**

1. **Understanding the Concept of Virtual Images:**
- Virtual images are formed when light rays appear to diverge from a point. They cannot be projected onto a screen because the rays do not actually converge at that point.

2. **Identifying Diverging Rays:**
- Diverging rays are those that spread out after passing through a lens or reflecting off a mirror. They do not meet at a point.

3. **Using a Convex Lens Example:**
- When using a convex lens, if an object is placed at a distance greater than the focal length, the rays converge to form a real image. However, if the object is placed closer than the focal length, the rays diverge.

4. **Formation of Virtual Image:**
- In the case where the object is placed within the focal length of a convex lens, the rays that come from the object diverge after passing through the lens.
- To locate the position of the virtual image, we extend the diverging rays backward. The point where these extended rays appear to converge is where the virtual image is formed.

5. **Conclusion:**
- Since virtual images are formed by rays that diverge (and do not actually meet), the statement "Virtual images are formed by diverging rays" is true.

**Final Statement:**
- Therefore, the statement is true: Virtual images are indeed formed by diverging rays.

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