The correct options are
B refraction of sunlight from water drops
C dispersion of sunlight from water drops
Rainbows are caused by the splitting of white sunlight, into its constituent colors, by raindrops. Some of the light that falls on a water drop enters the drop. As it enters the drop (due to refraction), the color components of the sunlight are dispersed and get bent by different amounts depending upon their wavelengths (we perceive the different wavelengths as different colors.) forming the rainbow.