Final answer:
The story 'Hills like White Elephants' is set in Spain, where the main characters discuss a significant decision at a train station.
Step-by-step explanation:
The short story Hills like White Elephants by Ernest Hemingway is set in Spain. Specifically, the story takes place in the Ebro River valley at a train station, capturing a conversation between an American man and a woman named Jig. The setting is important as it provides a backdrop for the tension-filled dialogue about an operation the couple is considering, presumed to be an abortion. Hemingway's stories are often noted for their emphasis on dialogue and the 'iceberg theory,' which suggests that the underlying truth of a situation should not be evident on the surface but should be implicit, much like the bulk of an iceberg lies beneath the water's surface.