What steps should be taken to configure a PHP application, database, and server to properly handle UTF-8 encoding for special characters like "ä"?

To properly handle UTF-8 encoding for special characters like "ä" in a PHP application, database, and server, you need to ensure that all components are configured to use UTF-8 character encoding. This includes setting the character encoding in your PHP application, configuring your database to use UTF-8 collation, and ensuring that your server is sending the correct headers to specify UTF-8 encoding.

// Set UTF-8 encoding in PHP
header('Content-Type: text/html; charset=utf-8');
mb_internal_encoding('UTF-8');

// Set UTF-8 encoding in MySQL database
$mysqli = new mysqli("localhost", "username", "password", "database");
$mysqli->set_charset("utf8");

// Set UTF-8 encoding in server configuration
// For Apache, add the following line to your .htaccess file
AddDefaultCharset UTF-8