How do you fix a loose arm on this toy

Munch Fazbear  either the end of the arm is worn down (to small) or the hole inside the head is worn out (to big). If it is just one arm that is loose measure the ends and compare the results. If it is the arm you can get replacements. If the arms are pretty identical then measure the “hole in the head" (do both arms feel loose in the same hole and fit properly in the other). You can get replacements for that as well. Of course if you have 3D printing capabilities you could always make some replacements.