The block and tackle, or compound pulley system is something of a mechanical marvel: it makes lifting heavy objects far easier by spreading the weight over a longer distance. This does mean that to halve the weight means you pull twice as far, but it's a trade-off that works extremely well--even on a small scale. Whatever you may need it for, there are a number of ways to apply this to the small scale.
Lay out your pulleys on a flat surface with the top of both facing away from each other.
Count the number of pulley wheels you are working with. If the number is even, tie the rope to a fixed point on the upper pulley. If there are an odd number of pulleys, tie the rope to the lower pulley.
Loop the rope around the other pulley. If you tied rope to the upper pulley, loop around the lower; if you tied to the lower, loop around the upper. Work from the innermost pulleys out if you have multiple pulleys in line with each other.
Pull the rope through the pulley you tied off on. Repeat this step, attaching it to an unused pulley wheel until you fill all of the wheels.
Attach at least two eye hooks to the top of each wood block. Use more eye hooks to spread the weight further, but make sure they are placed evenly along the block. Lay the blocks on their sides with the eye hooks facing each other.
Install the cup hooks in the centre of the bottom panel, the opposite side of the eye hooks.
Tie the rope or string to the left- or right-most eye hook on the lower block, your preference.
Loop the rope or string through the hook that corresponds to the one you tied off in step 3. If you have difficulty getting the thread or rope through the pulley, you can thread it onto a needle.
Thread the rope or string through the empty eye hook next to the one you just used on the lower block.
Thread the rope or string through the next empty eye hook on the upper block. Repeat steps 5 and 6 until you have filled all of your eye hooks.
Attach the upper pulley or wood block to the frame you're working with.
Attach the lower pulley to the object you wish to lift.
Pull the trailing end of the rope to lift the object.
If you don't have really small pulleys available, you could use anything that will work in the same way. A grooved wheel from a toy car or train, or the small LEGO Technic washers are the right shape for the pulley wheel. These same principles will work with a block and tackle system on a large scale as well.