Hi my name is David.
While it is not possible to add text to a picture with iPhoto
, you can do it with Preview.
Select the picture you want to add text to in iPhoto, and click File -> Export.
Save the picture on the Desktop using the options in the save dialog.
Quit iPhoto, right-click the picture file on the Desktop and click Open With -> Preview.
If you are using OS X Lion, then click View -> Show Annotations Toolbar.
Then click the capital later 'A' and the cursor changes to a crosshair.
Drag the crosshair to make a box where you want the text on your picture.
Choose your Font and type your text. You can reposition the box when you have added the text.
When finished you can click File -> Save As, and save your updated picture on the Desktop.
This is how you would do it with the bundled applications, but if you want you could get third party applications such as Photoshop or Gimp to do the same thing.
I hope this helps.