Where it’s found: The Merchant of Venice, Act I, Scene I
How it’s used:
SALARINO: Now, by two-headed Janus,
Nature hath framed strange fellows in her time:
Some that will evermore peep through their eyes
And laugh like parrots at a bag-piper,
And other of such vinegar aspect
That they’ll not show their teeth in way of smile,
Though Nestor swear the jest be laughable.
Where it comes from: I find it very… laughable that one of Shakespeare’s problem plays coined the term laughable. (What, you don’t come here for my incredibly lame puns? I am agog, aghast, and other sorts of fancy words!)
With that out of the way, laughable is a compound, made up of two parts: laugh and the prefix -able.
Laugh is Old English, and was originally onomatopoetic. The Anglo-Saxon word for laugh was hlæhhan. This is related to a number of other Germanic words that look like someone just hit their keyboard in an attempt to coin a word. The pronunciation was originally lack, but here we are with our yuck-yuck word laff. [source]
-able, on the other hand, came to us from the Romans; Latin had two suffixes for words that meant “a capacity to do,” -ibilis and -abilis. Interestingly enough, in English native words get tagged with the suffix -able (hence, laughable), while more obviously Latin words get stuck with -ible (e.g., horrible, crucible, etc.) [source]