Update CONTRIBUTING.md documentation with app settings and extension … (#695)

* Update CONTRIBUTING.md documentation with app settings and extension bundle sections

* Update extension bundle version in sample host.json file

Author: kamperiadis

CONTRIBUTING.md

@@ -171,6 +171,35 @@ With this you have completed the setup for Azure Functions Host and the Azure Fu
 
   - Restart host debugger
 
+#### App settings
+You can run your local function app in two ways:
+1. By running the host code and worker code
+2. By running core tools
+
+If you are running the host code and worker code to debug your function app, then you need to add the app settings as part of the host's environment variables (in launch.json).
+
+If you are running core tools to debug your function app, then you need to add the app settings in your function app's local.settings.json file.
+
+### Common Issues
+#### Extension Bundle
+If you are running the host code and worker code to debug your function app, the extension bundle does not need to be enabled if your local function app only uses the HTTP trigger. However, it does need to be enabled when using other types of triggers and output bindings (e.g. EventHub). Otherwise, you will get exceptions like "The binding type(s) were not found in the configured extension bundle. Please ensure the type is correct and the correct version of extension bundle is configured". In order to enable the extension bundle, you need to follow the steps here:
+https://github.com/Azure/azure-functions-host/wiki#extension-bundle-configuration
+The `downloadPath` attribute can be any path in your local machine and is used to indicate what directory you would like some generated files to be saved.
+
+This is a sample host.json file configuration in the function app:
+```json
+    {
+      "version": "2.0",
+      "extensionBundle": {
+         "id": "Microsoft.Azure.Functions.ExtensionBundle",
+         "version": "[4.*, 5.0.0)",
+         "downloadPath": "C:/Users/<user>/Repos"
+        }
+    }
+```
+
+If you are running core tools to debug your function app, you do not need to enable the extension bundle.
+
 ### Running unit tests
 
 1. Add your unit tests under ./src/test folder