A page displays a 404 page when the page has been deleted or moved due to change in permalinks. And because of this a user normally leaves the page or closes the tab, if they don’t find what they are actually looking for. This will effect your blog readership and also search engine traffic. Yes, you can also loose your blog search engine ranking, if there are too many 404 pages. Search engines extremely hates 404 page. And a solution to this, would be to redirect that 404 page to the updated link/page or create a useful 404 page, so you don’t loose your blog readers.