When you mix oil and water the oil rises above the water because it is less dense. The same thing happens with ships, they contain a lot of air and so are less dense than water and float. If you add too much weight to a ship you can make it more dense than water, which will cause it to sink.
Absolutely – if the mass of the ship exceeds the mass of water it displaces then it must sink.
In reality a ship is in serious danger even if it is overloaded short of the mass of water it displaces, because swell or waves may then flow over the sides and very quickly increase the mass to the point that it sinks.
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