How to record output audio on windows 7?

I have the windows sound recorder and I have Audacity. Neither of which I can get to work to record output audio. I have tried going into control panel, I have NO stereo mixer option, microphone is the only option there. I cannot get hardware or special cords or anything. I really think this should be an easy thing, it was easy with windows XP but now that i have windows 7 I have no idea what to do. I've researched so much today, im just sick of it. can anyone help me?