he emitter resistor is there to provide DC bias to the base. If it is not bypassed, then the AC output signal is also dropped across this resistor, effectively lowering the output swing.
When a bypass capacitor is added, the DC bias still flows through the resistor, but the capacitor acts as a short circuit for the AC signal, so that the AC signal is not reduced. The capacitor selected must be large enough so it appears as a very low resistance at the lowest frequency the amplifier will pass.
from:http://www.techanswers.cc/electronics/electronicsengineeri/201601/138284.html
When a bypass capacitor is added, the DC bias still flows through the resistor, but the capacitor acts as a short circuit for the AC signal, so that the AC signal is not reduced. The capacitor selected must be large enough so it appears as a very low resistance at the lowest frequency the amplifier will pass.
from:http://www.techanswers.cc/electronics/electronicsengineeri/201601/138284.html