Why, on your web pages of course. Ok, just kidding. The real question should be: "Is there really any truth to the rumors that where you place those Google Adsense ads can actually improve response?" According to my best information, the answer to that question is: Yes.
Google's own Adsense experts say that that there is a direct correlation between the placement of the Adsense ads and the resulting click through.

When ads are placed in "content zones", rather than in "advertising zones", response rates on Google Ad Words goes up. There are also indications showing that ads appearing on the right side of the page get clicked more than ads appearing on the left side.
Advertising analysts with degrees in human behavior and psychology have spent thousands of man-years (people-years?) studying how people read printed and Internet content and what it takes to get them to respond to ads. While some of these studies are proprietary, or are only available to anyone with $10,000 or more to spend on a copy, other studies have been made public and can be read by anyone who is interested.

Google themselves has released some relevant information which is focused directly on increasing your Google Adsense response. In Google Adsense, all the webmaster has to do is place a code on his website and Google takes care of the rest. The ads that Google would place on your site would generally be relevant to the content of your site. This would be advantageous both for you and for the advertiser, as the visitors of your site would more or less be actually interested with the products being advertise.

Of course, all of the studies in the world aren't worth a hill of beans if the findings don't work on your web site. That's why it is important to test, test and test again. Experiment with your Google Adsense placement and track the results over a period of time. Google provides response tracking tools in your Adsense control panel. Learn how to use them. As you begin to see what may be only subtle differences in response, you'll be able to determine what works best for your particular site. But don't get complacent. What's working for you now might not work next month if you change your site design or content.

One of the most important factors in determining placement of your ads is the type of content that your site delivers. If you are primarily an e-commerce site, and you have a lot of pictures and ad copy for your own products competing for attention against Adsense ads, then it is going to be a particularly tough challenge getting any kind of decent Google Adsense click through. It is situations like this that require very thorough testing and a lot of trial and error.
Blogs seem to have a lot of success generating high response rates to Google Adsense listings. Perhaps it's because blog readers realize that ad revenue is the only way that their favorite blogmaster can keep the lights on, so the readers think of clicking on ads as a way to make a donation.

Regardless of what the experts say, your best bet is to tailor your Google Adsense ad placement to what your own experience shows works best for you. In the end, you're the only expert who matters.