Here's a breakdown:
* the students: This is the head noun of the phrase.
* in many: This is a prepositional phrase modifying the noun "students." It tells us where the students are.
* taunt each other: This is a verb phrase, specifically a present tense verb, describing what the students are doing.
The entire phrase "the students in many taunt each other" acts as the subject, performing the action of "taunting."