Yikes that's really rough!
I have a few suggestions before you do the reset. I read an article saying wiping the cache and trying again could help. You could also try booting the phone up on safe mode and testing it out to see if the audio issue continues. If it works fine in safe mode, there may be a 3rd party app that could be the culprit. If that's the case, you'll need to uninstall a any 3rd party apps that could be causing the issue. The last step, as you mentioned, would be resetting the phone and testing it out before downloading your stuff back.
Please keep us posted on how it goes.
Happy New Year! Just dropping in to see if you'd had the opportunity to run through the troubleshooting Mike recommended here. Have you noticed any improvement since completing these steps - can your friends and family hear you again? Please let us know if you were able to avoid the reset, or if you completed that step, too! Hoping you've got good news to report.
Thank you all for your help and suggestions. But unfortunately, I was
unable to resolve the problem and had to "factory reset" the phone and send
it in for repair.
Aw, shoot! I'm so sorry to hear it - I know that process is no fun. I'm so sorry you received defective equipment, but I'm glad that you were able to get it repaired/replaced. Please let us know if we can assist in any other way!