Answer: The word that correctly completes the sentence is "its".
Explanation: "Its" is a possessive pronoun, that is to say a pronoun that indicates belonging and that must be used before a noun. On the other hand, "it's" is a contraction of the words "it is"; however, the sentence provided does not make sense if "it's" is added after "lost". The missing word must accompany the noun "muffler". "Its" can complete the sentence provided because it is a possessive pronoun that accompanies nouns which denote things and not people. Moreover, "its" adds coherence to the sentence.
