This blog explains about a workaround to solve the build error in the code example "PWM GPIO".
After importing the "PWM GPIO" code example, you will be able to see the following files in the project explorer of Modustoolbox IDE.
The "libs" folder files are causing the build error which is actually not required for this particular application.
Please follow below steps to resolve the issue:
Example: In my system PWM_GPIO app is created in "C:\Users\username\mtw\PWM_GPIO".
"mtw" is the modustoolbox workspace folder.
PWM GPIO Code example (Release-v1.0.0)