What version of Premiere Elements are you using and on what computer operating system?
For now I will assume Premiere Elements 11 Windows, so please take a look at Tools/Audio Mixer and Tools/Smart Mix.
You may want to review the following Adobe Tech Note on the subject
We can be more specific with more details; Audio Mixer and Smart Mix can also be found in some versions of Premiere Elements earlier than 11.
I am using 10 on Windows 8
Thanks for the follow up information regarding Premiere Elements 10 on Windows 8 64 bit.
Essentially same principles, but different feature locations. In version 10, look to the green speaker icon just above the Timeline. Clicking on it will result in drop down list which includes Audio Mix and Smart Mix.
The information already provided in the link,
although directed at Premiere Elements 11, can be guide for your work in Premiere Elements 10.
However, the following is a version 10 specific resource
Please update us on your progress when you get a chance.