Patti, do you want just a standard circle or square, or are you referring to something more sophisticated, like the shape of a rabbit or ??
If you just want to encircle something in red, use the Elliptical Marquee tool to create the circle, and then go to Edit>Stroke and set the width of your outline in pixels and the color. Or you can select the custom shape tool and then select the option of a hollow ellipse under "Shapes" on the Option Bar.
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