I think this is a very hard decision to make and it's one that only you can find the right answer to, but here are some pointers to help you along the way.
1. Have you put the manuscript away so you're coming to it fresh?
You need distance to work out what you're doing wrong. The easiest way to get distance is to put your ms away for at least 4 weeks, more if you can bear it. Up to you whether you start a new novel project in this time, but I'd definitely recommend writing something else.
2. Can you see what needs doing?
If the feedback you've already received doesn't make sense to you, then there's no point in fumbling around trying to rewrite. You have to write with conviction; if you don't understand the fundamental problem you won't be able to correct it. I'd be inclined to write something else in this situation and wait for time (and experience) to show you what wasn't working.
3. Does what needs doing involve a lot of work?
I've been there. I realised what needed doing would involve a major rewrite and put it off for several months because I didn't want to do the work before deciding to just Do It. I've seen other people decide against re-writing because they didn't want to do all that work. Your call, but I think if you understand what needs to be done, then it's a lot less work to fix that than it is to write another novel. Plus you will learn a lot from the re-write, and maybe won't make the same mistakes again...
4. How many times have you sent it out?
One of my writing friends has sent her novel out twice, and has had encouraging responses both times - but no acceptance. She's now re-writing it, which I think is daft. Another, even dafter friend hasn't even sent it out because she thinks it's not quite right yet, despite everyone telling her it's fine. (You know who you are - get on with it!) I think you need to send it out at least 6 times before you can begin to judge where it stands in the market place. Leave the novel alone until you've had that feedback, and get on with writing something else.
5. How much have you written before?
It always amazes me that people launch themselves into writing a novel with no previous writing experience, knock it off in a couple of months (or even weeks) and then think it's finished to a standard that someone else should give them thousands of pounds for it. You wouldn't treat any other creative discipline in the same way, such as painting or pottery. Get real! Yes, it's possible you may have written a masterpiece without any previous experience, in the same way that buying one ticket might win you the Lottery jackpot, but it's not very likely. And the chances are you won't understand why your work isn't up to the standard required which will lead to frustration. Re-writing will teach you a lot, as will writing something new. Going to classes, reading lots of novels (both in and outside your genre), joining a critique group will also teach you more about creative writing.
There are plenty of successful novelists out there who wrote several novels before they got published - I personally know at least 4 novelists who are now doing very well who have 6 or more unpublished novels in their bottom drawer. Writing something new worked for them.
I was advised to treat Adultery for Beginners as a learning experience and start another novel. I did an extreme re-write instead (in the end, about 90% was substantially re-written). So extensive re-writing worked for me.
But - and this is the big but - I understood exactly what the problem was, and could see how I could fix it. If you don't, writing another novel may be the learning experience you need.