Select songs which accompany each event in the story. Identify the event/section of the story it would go with. Explain why you would use it and what it would add to the story.
I gave a similar assignment to a class a few years ago. I asked them to create a soundtrack for a novel we had read that year, as if the novel were a movie. Music is used in movies to reflect the emotional impact of the action on screen, and to draw audience members into the experience. If you think about the story, "The Red Convertible" by Louise Erdrich, as a movie, this will help you complete the assignment.
First, make a list of all the important events of the story. This will tell you how many songs you should select. Then, try to identify the emotions that are felt by the characters during these events. Are they happy or excited? An upbeat song choice would be best, then. Are they sad instead? A song with a slow tempo and minor chords can reflect that sadness. If you choose songs that make you feel these emotions, then you'll be on the right track.
You might also want to consider keeping the song choices specific to the setting of the story. This is another technique used in movie soundtracks to transport an audience back to a certain time period or place. For instance, in the television drama Mad Men, which takes place during the early 1960's, all the music heard is music that would have been played at that time--you won't hear a punk rock song, for instance, or hip hop. Since this story takes place during the pre- and post-Vietnam 70's, you have a lot of great classic rock songs to choose from.
If you get stuck, try reading some lyrics. Even if the song doesn't sound quite right, the lyrics might reflect a sentiment or moment in the story. Good luck with this assignment, and have fun!