Question

Why does iron nail sink why don't ship sinks.

Answer 1

A thing will float if its _average_ density is less than the density of water. 

Although the ship's hull may be made of iron, the ship also has a lot of lighter things (including a lot of air) inside it. When you take into account all the air, etc., the average density of the whole ship is less than the density of water.

But there are no air pockets in a nail. Its average density is the same as the density of iron; so it sinks.