Answer to Question 1
Subjectivity is a problem in case studies for two general reasons. First, the researcher has to decide what details of a person's life or behavior to focus on. It is possible to evaluate the wrong ones so that an incomplete and distorted picture emerges. Second, the interpretation of the results, especially when based on incomplete data, becomes very subjective as well. There can be problems like confirmation bias, as the researcher ignores contrary data and interpretations.
Answer to Question 2
Case studies are strong in external validity because they involve studying people in natural settings, not in an artificial situation like a laboratory. Thus, from the point of view of mundane reality, case studies are strong. On the other hand, they are weak in external validity from the standpoint of generalizability. It is not clear whether the results from a study of a single person will generalize to other people in other situations.
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