Burnout is what also causes stagnation, genius.
If you keep pumping out new games on annual basis, then you have no time to develop and test new tech and ideas. A lot of assets get reused, players start burning out from seeing same things over and over again and games become creatively bankrupt.
When it comes to development costs. Constant factory work only keeps increasing development costs while dropping the profits. Hence why a lot of companies like NRS, Capcom or EA employ Contractors. Cheap labor force, that gets sacrificed to Overwork Gods and then get thrown out, once they burn out, which also causes people to start seeing Game Dev as a work that isn't worth it. It is an unsustainable short term process and now at the end of this decade we are seeing the results. Franchises dead or burn out, remakes, reboots and asset flips everywhere. Triple A studios don't experiment or try new things and just keep bringing same shit over and over again. This led to the death of Battlefield as well.
Basically what I am saying is that your math f%cking sucks, cause you have no idea how much everything costs and thanks to moronic thinking like that we got shit like Battlefield V, Terminator: Dark Fate, Call of Duty, Assassin's Creed that has no Assassins, etc and caused us to buy EARLY ACCESSS GAMES that get finished 2 years later.
Going to any of those 2 extremes is a sign of being a retard and that retard sucking at his management. Like all things, there has to be a balance. A good and profitable game requires time. Not too long, but long enough for new tech to be implemented, for bugs to be fixed and gameplay mechanics ironed out. Only then you will have a long term successful business plan.
Also with nowadays tech, we are reaching the point, where you don't even need to make sequels anymore. You just keep upgrading and adding content to existing title. Soon we will be seeing games, which will devs be able to graphically and mechanically upgrade every 2-3 years.