Economic  Problem: outline the major shortcomings of real business cycle theory as a framework for understanding short-run economic fluctuations ,how does the ‘canonical New Keynesian model’ seek to address these shortcomings?

Economic  Problem

Outline the major shortcomings of Real Business Cycle theory as a framework for understanding short-run economic fluctuations , How does the ‘canonical New Keynesian model’ seek to address these shortcomings?

Word limit; 750 +10% (word limit excludes the list of references; use the Harvard system of referencing for this question).