Suppose you sit in a rubber boat in a swimming pool. In the boat lies a stone. You throw this stone from the boat into the pool. Will the water level in the pool raise or drop?

For a floating body it holds that the weight of the volume of displaced water is equal to the weight of the floating body.
A body which is sunk displaces as many water as its volume.
Since the density of stone is larger than the density of water (which means that 1 litre of stone weights more than one litre of water) the water level will drop if the stone is thrown into the pool.