The most accurate answer is that it has the same function as any capacitor, big or small. It provides a Laplace impedance of (sC)^-1 with the rest of the circuit. I do not expect that answer to make any sense at this time because understanding the Laplace transform requires first an understanding of Calculus. (The Laplace transform makes many Calculus problems much simpler.) What you should grasp from my answer, the rest of the circuit that the capacitor directly connects to must be known to determine precisely what function a capacitor performs.
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"Don't disturb my circles." translation of Archimedes last words
When you consider that an UPS unit has to suddenly operate a three, four hundred or more watt AC appliance or computer with smooth current, you understand why they have the biggest transformer and capacitors and battery they can afford to provide for the selling price.
Many of these units come with performance guarantees of component protection and backup power for the time promised. I expect they get the caps at a good price for volume sales.
"Almost" Good Answers: