Why do rainbows form arcs?
Short answer
Light refracts, reflects, and separates into colors inside water drops. Light reaching the eye from a particular range of angles forms an arc.
How it works
From the ground, the rest of the circle is hidden below the horizon. From a high viewpoint, a larger part of the circle may be visible.
Key point
The practical point is this: From a high viewpoint, a larger part of the circle may be visible.