<![CDATA[The increasingly intense volatility of consumer trends in the digital economy era has created demand uncertainty that challenges Indonesia's fashion industry in determining optimal production volumes. This study aims to analyze the optimization of production decisions in Indonesia's fashion industry based on marginal cost analysis and demand elasticity as a response to consumer trend volatility during 2020–2024. A quantitative approach using multiple regression and cost function analysis was applied to data from 156 Indonesian fashion companies listed on the IDX and digital platforms over five years of observation. Results confirm that optimal production conditions are achieved when marginal cost equals marginal revenue (MC=MR) with a coefficient of determination R-squared of 0.791. The price elasticity of demand for Indonesian fashion products averages −1.847, confirming elastic demand, while cross-elasticity to social media trends of 2.134 indicates very high demand sensitivity to digital trend changes. Fashion companies that apply marginal cost-based production decisions are proven to have average profitability 23.7 percent higher than those using conventional production approaches. This study provides an operational managerial economics analytical framework for Indonesian fashion industry players in optimizing production decisions amid increasingly unpredictable trend volatility.]]>
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