In order to embed an image in a knowledge base article using Markdown, perform the following steps:
1. Go to Service Desk | Knowledge Base | Knowledge Base Articles, click "Choose Action" and then select "New".
2. Give the Article a Title.
3. Select the "Use Markdown" checkbox.
4. Add something to the body, anything will do for now.
5. Upload the picture you wish to embed as an attachment.
6. Save the article.
7. Select the article from the list to edit it.
8. As you add the Text to the KB, the Markdown syntax to display the image will be: 
NOTE: To find the correct URL for the image, you can either hover the mouse over the link for the image, or right-click on the link for the image and select "Properties" if using IE or "Inspect Element" if using Chrome, Mozilla FireFox, or Safari.