For me, this problem occurred because of some other reason. So even though it has more than 30 answers, I still feel my solution might help someone.
My styles.xml was looking something like this:
<style name="AppTheme" parent="...">
    ....
</style>
<style name="AppTheme.NoActionBar" parent="...">
    ....
</style>
And my AndroidManifest.xml was something like this:
<application
    android:label="@string/app_name"
    android:theme="@style/AppTheme">
    ....
</application>
And for some reason, I decided to have my theme without ActionBar, so I went ahead and deleted it from my styles.xml. So here is the updated one:
<style name="AppTheme.NoActionBar" parent="...">
    ....
</style>
In addition to this, I had to update the theme in my manifest file, but I forgot that. So when I run the app, I got the error saying:
Error: Default Activity Not Found
After a long struggle, I found the problem and modified my manifest fle accordingly:
<application
    android:label="@string/app_name"
    android:theme="@style/AppTheme.NoActionBar">
    ....
</application>
Conclusion:
If you have a wrong AndroidManifest.xml which may lead into manifest merge failed, then AS can give this error.