I want to switch ON and OFF an incandescent bulb using MCU. Please suggest an electric switch (like relay or something) for 220V 50Hz AC line which can be used here. I would prefer something very cheap to keep the total project cost minimum.
EDIT: Don't limit this to incandescent bulb. The solution should be applicable to every daily life electrical appliances.
The cheapest solution is an ordinary mains relay with normally open contacts. Put the bulb in series with the contacts and the mains supply, and control it with a low voltage on the relay coil. Relays with coils that can be switched with the output from an MCU are readily available. Don't forget to put a diode or snubber across the relay coil. If you use a transistor driver, you can probably use a very cheap, less sensitive relay.
The best solution for an incandescent lamp is a SSR (Solid State Relay) with zero-crossing detection. (Zero-crossing switching increases the bulb's life.) An SSR module is the most convenient, but they're not cheap. If price is an issue you can better build the SSR from discrete components. Below is an example using the MOC3041 as opto-triac.
Despite Leon's comment this is an inexpensive solution. In this thread I calculated the cost as 2.10 euros; an electromechanical relay (+ transistor, diode, ...) often costs more.