Adding Google adsense ads to my website

You need a plugin. Here’s a list; this should get you started.
http://www.techieblogger.com/2009/08/adsense-wordpress-plugin.html

Why would a plugin normally generate a 500 error? Check the ratings on each plugin page and see the comments to find out whether the plugin works or doesn’t work. It takes just a second to install a plugin from a zip file from within the WP dashboard.