I specified AVD memory 2048 Mbyte instead of 1536 Mbyte. Things
started to work again. (I'm developing on macbook.)
I tried "Kuldeep Chandel" solution which is to duplicate AVD and my app runs again too. Because of that I specified RAM again as 1536
Mbyte. Guess what... It worked...
I think AVD confuses to handle things and we need to duplicate the current AVD, and use it instead of the problematic one.
I had the same problem. Selecting Cold Boot Now in AVD manager solves the problem.
But I have to open AVD manager each time when I want to launch Emulator and I just want to click on Run app button and select device, without opening AVD manager.
To solve this: open AVD manager -> Edit device -> Show Advanced Settings -> Boot option -> select Cold Boot instead of Quick boot.
I faced this issue on using Android API 28 emulator with Android Studio 3.0.1. Android API 28 requires Studio 3.1 and above. Once I updated Studio to 3.1.4 and Android Emulator to the latest version, it worked.