That looks like the old syntax for setting captions. It got moved around when MMD3 came out. It is now:
But while we’re at it, I should mention that this can all be done rather seamlessly with Scrivener. You can drop a graphic right into the editor and it will generate all of the syntax for you, and automatically export the graphic file to the compile folder. To caption the figure, either add it to the same line as the graphic, enclosed in straight double-quotes or matching square brackets, or on the line directly following the graphic, in matching square brackets.
Hence, something like this in Scrivener:
Results in this MMD code:
![The results of using horizontal distribution on four notes.][DistributeHorizontal.png]
... Rest of Document ...
[DistributeHorizontal.png]: DistributeHorizontal.png width=337px height=144px
Will produce code like this in LaTeX:
\begin{figure}[htbp]
\centering
\includegraphics[width=337pt,height=144pt]{DistributeHorizontal.png}
\caption{The results of using horizontal distribution on four notes.}
\label{distributehorizontal.png}
\end{figure}
Note that a handy side-effect of using this method is that Scrivener uses the image name as its internal ID. That means you can cross-reference the figure like so.
You might note the purple highlight in my example. I stash the name of the graphic in an Inspector comment so if I forget it and need to cross-ref it, I can just look it up. A nice side-effect of that is that I get a list of figures in the sidebar. 
But, if you do prefer typing out the code, or need to for advanced syntax reasons, do note you can also use a Scrivener link from the filename part of the syntax, to that graphic in the research folder of the binder. That will enable automatic export of the graphic for you.
