Admins have the ability to change a users password via their User record.
Navigate to: Configuration => User & Permissions => Users
Open up the User record and then edit the password field.
Fig 1 - User password options
You have two options for the Password setting, you can either:
Email a "Set Your password" link to the User - if selected, this will email the New User with a link so they can set their own password.
Specify password (Note: User is NOT sent a notification) - if selected, you will specify and confirm a password yourself and then manually tell the User what you have selected. This second option will not generate an email to the new User, so when creating the User, you may want to use the first option.