Tutorial-
1) Have the two tools next to each other for a quick switch.

2) Stand on top of the dispenser and start desroying it with the pickaxe tool.

Once the dispenser is nearly destroyed, click the left/right bumper to switch to the next tool (still holding down the trigger)

3) Once the dispenser is destroyed it will glitch and respawn, hop of the dispenser then open it up

4) Drag the item you want to duplicate into the middle of the Dispenser

5) Hold down 'a' on the item you placed inside it (this will pick up then place constantly)

6) After a few seconds the dispenser will be destroyed, walk over and pick up the duplicating item it dropped.