If it’s a joke I find overtly offensive, I’ll usually say something, but if it’s simply unfunny, I just don’t react at all. If it’s between me and another person, it dies a quick-but-awkward death. If it’s in a crowd, there will always be people who do laugh (regardless of whether it’s sincere or not) so no harm/no foul. I certainly don’t draw attention to the joke’s badness, I just let my non-response speak for itself.
Jokes that are offensive, no, I don’t laugh at. There’s a certain meanness to them – racism, anti-women (I’d say “mysogeny” but I can’t spell it) some ethnic and scatalogical jokes – they aren’t just unfunny, they’re evil and nasty and I usually just make a face that says I can’t believe someone would tell me a joke like that.
On the other hand, there are perfectly innocent jokes that I’ve heard numerous times before, or just aren’t that funny to begin with. These, I laugh at. I learned how to laugh convincingly when I was in high school and college and was in a few plays – after you practice a few times, it’s not that hard to do.
Do you sound like Monica or Chandler when you’re fake laughing? 
I laughed at this:
A man is in the checkout line at the grocery store when he sees a thirtyish, attractive woman looking at him from the next line over. The woman does a double take, then smiles shyly and waves at him.
The man says, “Do I know you?”
She replies, “I think you may be the father of one of my children.”
The man thinks back to the one time he was unfaithful to his wife. He says “Wait a minute, are you the girl I did on Jeff’s pool table while your roommate smacked my butt cheeks with wet celery and stuffed a cucumber up my ass?”
She says “No, I’m your daughter’s second grade teacher.”