1. I set another place for Christmas.
2. I decide another place for Christmas.
I assume you mean for Christmas dinner.
Here, to "decide" means that you make up your mind to do something, to come to a decision. In this case you have decided to have an extra person to dinner.
Now you must "set" the place for them, which means to lay out the plate, knife and fork etc.
So first you decide to have another place, and then you set another place.
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