I'm a bit of a newbie to studio shooting my self, and I don't have any flashes yet but I have a pretty cheap setup, I'll share it with you.
First off, My backdrop.
The fabric isn't painted yet, but i used a modification of the design at Diyphotography.net
Total Cost: $11.41 for PVC frame the fabric, is 56" wide by 2 yds long (that was like $13.00
Next are my lights, as I mentioned I don't have flashes so I use continuous lights I usually use one to illuminate the backdrop, to provide separation, 1-2 on the subject sometime using 1 and a reflector.
Image 1: http://flickr.com/photos/21896544@N02/2211685379/
Image 2: http://flickr.com/photos/21896544@N02/2211684971/
3 Clamp work lights, 6.24ea from walmart. I should also mention for the backdrop I use a spotlight type bulb.