Your Nexus 7 cost (more than) 4x as much when it was introduced, no comparison.
Further, there's probably a market for people who want simple devices laying around at their bedside, couch or table that's bigger than their phone, more functional than an e-reader but not as clunky as a laptop (still very much a form factor for desks) for doing light digital stuff like reading the news, e-reader, checking email, browsing the web, watching video etc. None of this really requires high-end specs. This is exactly what I bought the Nexus 7 for (intro'd at $200 for the 7 and $230 for the 7 2nd gen), for my girlfriend, and she hasn't run a single app yet in the last 2 years that'd have required more specs than this tablet. The only thing she might miss is the N7's beautiful screen compared to the 170 PPI Fire tablet, but after buying a MBA a few weeks ago she still hasn't noticed the 128 PPI yet despite me pointing it out to here a few times and she's super happy so even here I think the Fire tablet would've more than sufficed for her use.
Granted with 5 inch phones becoming the norm the 7 inch form factor is being squeezed a bit, but at $50 it's still a very interesting little consumption device to have laying around.
It's not for me but I've got several family members for whom it's pretty good value.