The way I read the requirement, yes it would hikermor

of course, as it ends up, it is up to the merit badge counselor as to what they teach and require to complete this requirement, as well as the scoutmaster's discretion/approval. As the merit badge counselor in question for our group, when we get to the shelter session of the merit badge, I want to at least discuss but preferably have the boys attempt to build various types of shelters, using man made materials such as tarps, ponchos, emergency blankets and cordage as well as natural shelters. I don't want to overwhelm them with too much, but I'd like them to see several examples of what is possible using items they could carry easily on their person, as well as several examples of what they can do for their natural shelter.

The merit badge pamphlet actually has a pretty good section devoted to shelters, starting with a picture of a scout huddled up in a large garbage bag, hug-a-tree style (the face hole etc). It goes on to discuss how the scouts should assess their surroundings and materials available, including any equipment they have with them like a tent, dining fly, tarp, etc. It discusses the importance of the shelter to not only keep out of the wind and rain but also to conserve body heat. It goes even further to discuss location, insulation from the ground, many various ways to use natural resources in building the shelter, especially when it accomplishes much of the building process for them. There are helpful photos and illustrations of scouts under tarp shelters, in caves, under trees, utilizing large rocks as part of their shelters, as well as presenting various types of snow shelters like tree pit, snow pit, snow trench, and snow caves.

As Montanero already pointed out, the WSMB pamphlet/handbook is an excellent survival resource.