Frequent moviegoers often note that movies are rarely based on original ideas. Most of them are based on a television series, a video game, or$,$ most commonly, a book

In general, does a movie or a book have a higher fixed cost of production?

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Hollywood releases about $100$ new movies every year while just one publisher, Penguin Random House, releases about $15,000$ book titles a year. How does your answer in part a explain such a wide difference? Which is riskier: publishing a book or producing a movie?

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Using a proven success $($at least in book format$)$ mitigates some of the risk of movie production so investors are much more likely to be willing to gamble that a successful book can be made into a movie than they are to gamble on a movie with no fan base. As a result, we can expect to see $\{$

$\}$ innovation in novels, the low$-$fixed$-$cost industry. Low fixed costs mean $\{\}$ entry.