I decided to update my JDK to Java 8, and installed to the default location of C:\\Program Files\\Java\\jdk1.8.0 with a jre subdirectory.
I
I ran into the same issue. My jdk was upgraded from a 1.8.0_172 to 1.8.0_202. And I kept getting the mentioned error although I changed to the right jdk, in the module configurations. What confused me was the fact that the API version was stamped with the old *_172 version in the dropdown of available project sdk's. I found the reason for this to be an old obsolete entry in the dropdown that referenced the old *172. After deleting this entry, the APi versions was magically stamped with the new version.
Note to self: Remember to sanitize your projects when new versions come along