The formation of rainbow involves all three phenomenon: Refraction, dispersion, and total internal reflection. The sunlight shines on a water droplet. As the light passes into the raindrop the light bends, or refracts. Due to slow down of light, white light gets dispersed into seven colours. A rainbow is a natural spectrum after a shower of rain (every water droplet acts as a small prism) formed due to the dispersion, refraction and internal reflection of different colours.