"Is there a city in America?"
Translation:Estne urbs in America?
You use in with the ablative to specify location. Except however, when it is a city, town, small island (one city), or one of the few lucky nouns like domus, then the locative case is used.
So, we cannot say Estne urbs Americae? unless we are talking about a city or town called America (but asking if a city is within another city may not make much sense).
As I learnt it in university and also found it on the internet, the particle -ne is supposed to be put at the end of the first word of the sentence, which is not necessarily the verb. So "Urbsne in America est?" should be another correct solution but was marked wrong by duolingo. Am I missing something?
I'm not sure if you can put -ne on nouns (anymore, too long ago). In case indeed you can this will be the reason;
You are discussing whether or not there are cities in america not whether or not the things are cities. You are negating the verb not the noun.
Urbsne would sort of become non-towns.
The grammatical case. Urbs is a third declension noun and you can find all its forms on sites like Wiktionary: https://en.wiktionary.org/wiki/urbs#Declension
Urbs is the nominative (and vocative) singular. The nominative is used as the subject of the sentence; the thing 'doing' the verb or being described with a form of esse (here est).
Urbe is the ablative singular which can be used on many ways, but currently in the course you will only see it used with a preposition like in which takes the ablative form of a noun to specify location. America here is in the ablative case.