Basically without math, certain metals have elecrons that are
"free" silver is one of these metals. These free electrons are
necessary for a condition called a surface plasmon to exist. Now
silver particles in an aqueous solution will have two parts to its
refractive index, that of the water and that of the silver
nanoparticles. Next is the interaction of light. Photons can be
thought as particles or waves, in this case we will think of them
as waves. When an electromagnetic wave interacts with the surface
plasmon mode it causes the free electrons that are part of the
surface plasmon to oscillate, usually in anti phase to the
electromagnetic wave. This essentially causes certain wavelengths
of light to be blocked from propagating, causing them to be
reflected and giving the colour that you see.
Im actuallydoing some research on silver nanoparticles at the
moment, and we can change this colour from yellow to almost
anything that we want. For a yellow colour we see a plasmon
resonance peak ca. 420nm but based on the size and shape of the
silver nanoparticles we can tune the plasmon resonance peak.
Mie theory can be used to calcuate the extinction co-efficents.
The reason why this is also called the surface plasmon is that the
light waves will not penetrate more than 50nm so the interactions
at the surface are the most important.