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open the wav file, go to save as, click change, and the sound selection dialogue will come up. you can set mpeg 3 (mp3), and the bitrate from there, and click ok. then save as usual.
Felt Tip Sound Studio is one of those that does it well...
...then there's iTunes - that'll convert songs in your library depending on what you've set your encoder as (go to the Advanced menu in the menubar).
And hey - as far as "free" ones versus shareware versus retail (I said "free" 'cause most freeware fucks you in the end) goes you can pirate pretty much anything... torrents, baby.
So saying that - I personally like the Roxio line - Jam is actually a well coded brick of software.