The Mute option opens and closes your microphone.
You may not mute someone else's microphone from this feature.
Good practice indicates you should leave it muted, except when you are speaking. The reason for this is it prevents any background noise around you from being heard by the class.
There is an up arrow beside the Mute button. There are several options, most of which you will not need. However, one of them is for Audio Settings. If needed, you might want to change your speaker and/or microphone volume levels.