yes. A ribbon or a tie also work.

I only recognise this from watching American TV/films. Yes, they literally put a sock on the door. But if your roommate locked you out and her boyfriend in (but no sock signal), I suppose you could say to another friend "can I sleep on your couch? My roomie's put a sock on the door." Your friend would understand. ;)

A sock on the door knob is a signal that people inside are having sex,

....are making love? Yes.