During a morning walk when I see Sun rising in the east it is quite large. Why? It is known that in the morning sun is at a greater distance than that in noon, so why it is larger? and red?
[Physics] Apparent size of sun
everyday-lifesun
Related Solutions
The distance of the Sun from Europe or the Middle East plays virtually no role. After all, many people on the Northern Hemisphere might be surprised that the Earth is closest to the Sun in January – it was on January 4th, 2014. It was 3 million miles or 3 percent closer than it is in July. Nevertheless, the winter is cold! Moreover, these 3 million miles are much greater than 3 thousand miles between Europe and a place of the Middle East but even 3 million miles are too small to really matter.
The winter is cold and Europe is colder than the Middle East for the same reason: the sun rays are bombarding the Earth's surface from a more "horizontal" angle than in the summer or in the Middle East throughout much of the year. When the angle of the sun rays is $\alpha$ from the vertical direction, the actual energy and heat coming per unit are is $$ \cos\alpha\cdot P $$ where $P$ is the power you only get if the rays are bombarding the surface from a perpendicular, normal direction. If you substitute $\alpha\to 90^\circ$, the expression above goes to zero.
The values of $\alpha$ are generally smaller in the Middle East than in Europe and $\cos\alpha$ is therefore greater because the Middle East is closer to the equator, it has a smaller "latitude", we say, and the equator is the place where the Sun often illuminates the Earth's surface from a perpendicular direction. On the contrary, the poles are cooler because the solar radiation only "touches" the surface while it moves almost horizontally. Consequently, $\cos\alpha$ is very small. Europe is somewhere between the Middle East and the North Pole so its temperatures are somewhere in between, too.
First, it must be said that the picture you provided in your question is extreme. The concept of light bending is true, but the amount that the light bends is nowhere near as large as the picture shows it. The quantification of how much light bends when transferring from one medium to another is called the "index of refraction," and air's index of refraction is very very close to that of a vacuum, so the bending of the light is very small, and the spreading apart of the colors in the light from the bending smaller still. Thus, the prism effect of the atmosphere is too small to notice with our eyes.
If you check the sky after the sun has set (but still providing light), you will see different colors the further up you look from the horizon (at least, I can from my home) in a rainbow-like fashion (although much larger than a rainbow). However, I believe this is due to the Rayleigh scattering of light in the atmosphere rather than any prism effects. (Rayleigh scattering is what makes the sky blue and sunsets red).
Here is a Wikipedia article on atmospheric refraction for more information.
Best Answer
While the sun's relative distance to you does change throughout the day, the change in apparent size is essentially not noticeable to the naked eye.
Radius of Earth ~3959mi
Average distance from earth to sun ~92.96 million mi
3,959mi/92,960,000mi = 0.0000641
So the change of your personal distance to the sun throughout the day is only about 0.00641% of the total distance (not really noticeable)
Actually, earth's distance to the sun changes on a much larger scale as it travels through its elliptical orbit (~91 million miles at minimum and ~94.5 million miles at maximum) and even this change is pretty much unnoticeable to the naked eye.
The Short answer to why the sun appears larger at sunrise: it is an optical illusion. At sunset or sunrise, the sun appears closer to the horizon and gives your brain a reference (the objects on the horizon, or the horizon itself) to base its size on. At midday your brain is given no such reference and may misjudge the sun's apparent size. The same effect can be observed with the moon.
Here's a cool trick: next time when it is a full moon out, go outside and take a piece of notebook paper and hold it at arms length. You'll notice that the moon fits entirely in one of the 3 punched holes on the side! It will fit at all times of the day - even if your brain tells you that it won't.