It allows one to estimate and analyze dynamic, nonlinear, simultaneous equations models. The models can be rational expectations models, and they can have autoregressive errors of any order. The estimation techniques include OLS, 2SLS, 3SLS, FIML, LAD, 2SLAD, and some versions of Hansen's method of moments estimator.
Stochastic simulation is one of the key options available to analyze models.
There are also a number of single equation testing options. Also, general nonlinear functions of coefficients can be maximized using the program, which means that maximum likelihood estimates of the coefficients of any model can be obtained after one has written out the likelihood function. One can move automatically from estimation to solution without any additional work. Rational expectations models are solved using the extended path method of Fair and Taylor. For forecasting purposes, the stochastic-simulation option of the FP program can be used to generate interval forecasts, which provide much more information to a business planner or policy maker than simple point forecasts.