Old Toad & Terence,
I was actually able to get a label inserted on a selected photo.
While in iPhoto I selected a photo and dragged it to my desktop. (I may not need to do this step but I am telling you about it anyway)
I opened 'Pages' and typed the label. While in 'Pages' I 'copied' the label.
I then displayed the selected photo using 'Preview'. While in 'Preview' I clicked on 'annotate'.
I then clicked on the 'text' button, and by dragging the cursor, I positioned a text box on the photo.
I double clicked in the text box, and chose 'paste'.
I then clicked on the 'show font' button, and selected the font and size (I chose 92). This increased the label to the size that I wanted to have on the photo.
I then returned to iPhoto and imported the modified version of the selected photo from my desktop.
At this point I was able to drag the imported photo into the area from which I had originally selected it, and send the original photo to trash, thus leaving the 'labeled' photo in its place.
Thank you both for your assistance.