Creating a plugin that will insert an image

Good afternoon. I am looking to create a plugin, one that inserts a certain image and also have the image show up in the editor, sort of like the smileys but it would be a single image. I have made a dropdown plugin but I cannot figure out how to insert an image and have it display in the editor as an image not the text <img src=image.png>.

Any help would be greatly appreciated!!

Thank you a bunch,
Larry