weird idle plz help!!

[crkdutch]

I just bought this celica. its a 2000 celica gt with 128,000 km.
I got it inspected at a garage and they told me everything was perfectly fine so i bought the car.

One of my friends came over and pointed out to me that when you rev the engine (in neutral or whilst driving) once you let go of the gas the rev drops. What I mean by this is: after reving to 5000 once i let go instead of slowly going down steadily it just drops all the way to around 1.5-1. He also pointed out that my rev while parked or in neutral is around 600 or 500 which he says is low.

When I rev my engine at higher numbers i get a cloud of smoke although after running for a bit it stops smoking at higher revs.

My friend suggested it was probably my mass air flow sensor or my filter that was just old and needed to be replaced. However I wanted other opinions.

Does anyone know what this is? How i could fix and what I should check?

Im really pissed off because i just blew most of my cash buying it and insuring it so its honestly making me sick atm because im worried itll cost me 2000$ to fix.. hopefully not..