Sudo nano command not found

I am trying to restore my IPhone 5s in ITunes and continually get error 17. My IPhone is now locked with the "Connect to ITunes" image.

When I follow the instructions here:

Error 3194, Error 17, or "This device isn't eligible for the requested build" - Apple Support

and enter the "sudo nano" command line in the terminal, I get this response:

sudo: nano/private/etc/hosts: command not found

I have tried restarting my computer (Macbook pro, IOS X 10.6.8) and when I try again I am prompted to enter my password. When I enter my password, there is no indication that the cursor is responding to my key strokes and when I hit return, I get the same "command not found" error.

I have been getting error 17 on this new IPhone when I am prompted to update the OS in ITunes during a sync. My ITunes software and Mac software are all up to date.

Thanks for any assistance you can provide.