In this experiment, students carry out a halogen-metal exchange reaction of methyl 2-iodobenzoate with isopropylmagnesium chloride in THF at 0°C to afford 2-carbomethoxyphenylmagnesium chloride, which is treated with "p"-methoxybenzaldehyde to give a lactone (phthalide) product. This reaction introduces students to the modern method of preparation of Grignard and organolithium reagents by halogen-metal exchange rather than by using metallic magnesium or lithium, which is rarely done in a research laboratory. It also demonstrates that Grignard reagents bearing reactive functionality can be prepared and utilized in synthesis, although students are still often taught otherwise. The IR spectrum of the crude product provides semiquantitative information on the success of the reaction because the lactone product and starting material ester and aldehyde have very different carbonyl absorptions, demonstrating the power of this technique to distinguish between functional groups. The product can be purified by chromatography, recrystallization, or trituration, which allows students to compare different purification methods in terms of time required, yield, and purity of product.