Inexpensive headgear worn by ambassador (5)
I believe the answer is:
cheap
'inexpensive' is the definition.
('cheap' can be similar in meaning to 'inexpensive')
'headgear worn by ambassador' is the wordplay.
'headgear' becomes 'cap' (cap is a kind of headgear).
'worn by' indicates putting letters inside (I've seen this in other clues).
'ambassador' becomes 'he' (His or Her Excellency).
'cap' placed around 'he' is 'CHEAP'.
(Other definitions for cheap that I've seen before include "Contemptible" , "A snip" , "Inexpensive or tastelessy showy" , "Low in price or tastelessly showy" , "not doing much damage" .)