Your workflow isn't very clear.
It looks like you assemble your ad in Photoshop. Your logo will never look "sharp" that way.
You should better assemble the ad in a layout or vector software.
Apart from that: is the logo vector or raster data? an Illustrator file can contain both. Go into outline mode and check if there are paths. If there aren't: bad luck, you'll have to vectorize the logo first.
Use the .ai logo file and prepare the document in Illustrator. Use the scale tool to size the logo to fit your layout. This is pretty basic desktop publishing. When you are done designing the ad, save a copy using "Save-For-Web" if the ad is destined for the internet. If it is for print, get the prepress rerquirements and prepare a copy for whatever the vendor asks for. Always keep the original .ai file intact. Send-out whatever as a copy of the original, just in case you need it for a termplate or future edits.