Solution:Relative density is defined as a ratio of the density of a particular substance with that of water. The relative density of pure water is 1. The substance having the relative density less than I will float in water, while substance having the relative density more than I will sink in water.
The ship is designed in such a way that its effective density (m/v) is less than the density of water and the weight of the water displaced by the ship is equal to its weight, so it floats upon the water. But the density of iron needle is much larger than the water, so it sinks easily.