Currency appreciation refers to the increase in the value of a domestic currency relative to a foreign currency. This means that one unit of the domestic currency can buy more units of the foreign currency. The correct answer to the given statement is option 'A' - True.

Explanation:

Understanding Currency Appreciation:
Currency appreciation occurs when there is an increase in demand for a country's currency in the foreign exchange market. This increased demand can be due to various factors such as a strong economy, high interest rates, political stability, or positive investor sentiment towards the country.

Impact on Exchange Rates:
When a currency appreciates, its exchange rate with other currencies increases. For example, if the exchange rate between the US dollar (USD) and the Euro (EUR) is 1 USD = 0.85 EUR and the USD appreciates, the new exchange rate may become 1 USD = 0.90 EUR. This means that the USD has gained value relative to the EUR.

Effects of Currency Appreciation:
Currency appreciation can have both positive and negative effects on various stakeholders:

1. Consumers: Currency appreciation benefits consumers who import goods or travel abroad as they can purchase more foreign goods and services at a lower cost.

2. Exporters: Currency appreciation can be detrimental to exporters as their goods become more expensive for foreign buyers. This can lead to a decrease in demand for exports and potentially harm the domestic economy.

3. Importers: Importers benefit from currency appreciation as they can buy more foreign goods at a lower cost. This can lead to increased imports and potentially impact domestic industries.

4. Foreign Investors: Currency appreciation can attract foreign investors as they can earn higher returns when they convert their investments back into their home currency.

5. Tourism: Currency appreciation can impact the tourism industry. A stronger domestic currency makes it more expensive for foreign tourists to visit, potentially leading to a decline in tourism revenues.

Conclusion:
Currency appreciation occurs when a domestic currency gains value relative to a foreign currency. It has various effects on different stakeholders, including consumers, exporters, importers, foreign investors, and the tourism industry.