How is rainbow formed?

A Rainbow is formed because of refraction, reflection and dispersion of light.

When the sunlight enters the rain drops, the light bends as it enters into dense water from the air. This is nothing but refraction.

During refraction, light splits into different colours inside the droplet. This is called dispersion.

The components of several wavelengths(colors) gets reflected when they hits the inner surface of the droplet.

When we see these colors it would appear like a rainbow.