This issue occurs when using Arduino IDE 1.6.8 or older with Arduino AVR Boards 1.6.12 or newer1.6.14. There are two solutions:
Upgrade your Arduino IDE to 1.6.9 or newer by downloading and installing the appropriate file from https://www.arduino.cc/en/Main/Software.
Downgrade your Arduino AVR Boards version to 1.6.11 or older(or 1.6.13) via Tools > Board > Boards Manager...
I submitted a pull request to fix this backwards compatibility issue and it was merged by the Arduino developers so this issue will no longer occur with Arduino AVR Boards 1.6.15 and up. It explains the cause of the issue: https://github.com/arduino/Arduino/pull/5427