Can you use AdSense and affiliate ads on the same web page?

I am speaking about Google AdSense and affiliate marketing all the time and again questions in connection with the same. One of the most asked questions is,

can I use AdSense and affiliate ads on the same page. Is it a violation of AdSense policies?

This is the most common question from newbie blogger, the just started Monetizing Your Website With Affiliate ads and have AdSense running on your blog. AdSense is a contextual ad network and do not allow under a different ad network which mimic ads like AdSense.