A game needs to make enough to pay for more than just the physical media and box. Graphicians, programmers, producers and musicians need to be paid, then there's box art, rent, taxes, duplication, distribution, advertising, electricity, insurance, the retailer's costs.
The app store pricing model has really distorted people's views of what games should cost.
I'm reminded of the old cliche "Kids today know the price of everything and the value of nothing."
