Q:

How to upgrade Google Play Services on emulator?

We have installed com.android.vending and com.google.android.gms files. 
Now we have got that warning 

"This app won't run unless you update Google Play Services".

What should we do now, what is emulator try to say?

A:

Your application requires higher version of Google Play Services than you have installed on emulator. You should check this link: http://developer.android.com/google/play-services/setup.html
Specific information is:

Install a compatible version of the Google APIs platform. If you want
  to test your app on the emulator, expand the directory for Android
  4.2.2 (API 17) or a higher version, select Google APIs, and install it. Then create a new AVD with Google APIs as the platform target.

You should create emulator as fresh as possible (API 19).

