I am trying to record cassette to my computer using an Encore model 2040MO with a USB cable. Nothing is working right. No recording, No play through. I tried several tutorials from internet but does not help. The Audacity manual is no help either. 
Are you getting sound out of the tape player’s speaker or its headphone jack?
Make sure you’ve selected the USB device as your [u]Recording Device[/u].
Yes I did all of that. But I found that the microphone volume control resets to mute and zero after a minute or so. when I unmute and increase volume it works for about a minute and then mutes again.
That is either because you have Skype which is interfering, or a bug in your standard Windows USB class audio drivers, or a virus on your computer, or perhaps a fault with the USB port or USB cable you are using.
You would have to try each of those possibilities in turn. An anti-virus check is always a good idea. Someone else had exactly your problem with a USB audio device and fixed it by running MalwareBytes to remove the virus concerned.
Gale