I would spend 200 of it on new content for your site. and 300 on adwords promoting all the new content you just bought good luck sean
I would spend $400 on Adwords, then take the remaining $100 and buy a really nice bottle of single malt scotch and watch the traffic come in.
thanks for the comments, I have been doing this seo process for my last couple of sites and have ended up on the first page of google for both sites. If you are willing to take the time to do what I have put on that list it will work. I take about 30-45 days to complete all the work and then I start to see results within a couple of months. I would just recommend not blasting all the work within a couple of days. Take your time with it. SEO is a marathon, not a sprint!
this is actually a service description done by submissionlive heres the link, coincidentally it costs $500 lol ive been on the fence of purchasing hxxp://marketplace.sitepoint.com/listings/46127 change x's to t's
If i have $500, then I hire someone to make an one super article or one super ebook. This will cost me maybe $250. Then I will do some advertising for $250 (about 1000 traffic). Also put news release, this strategy will lost long if the product is good.
I wouldnt even bother with PPC with just $500. Would buy some good PR Backlinks, submit to some good directories, buy a few articles and promote them. Chance, you deserve Kudos for that post.
The guy who does this service has gotten nothing but good reviews! There are several of his clients on sitepoint, but he only takes so many at a time. I have personally been doing it since I saw his post and it does work, but if you don't want to take the time, pay him
PPC is a great for new sites however there is an art to ppc and you really need to know what you are doing to maximize the amount of clicks you can generate for the best return on investment.
With 500 you can do quite a bit. I always make sure to optimize my own site first. Make sure users are enjoying it, and that it is effective at selling what you need to sell. Also, a good looking site will always trump a sloppy or unorganized one. With the rest of the money I'd look into SEO related stuff. Buying links, articles, etc.