What is the difference between "dead" and "dying"?

[Paula]

English Language Tests, Intermediate level

ESL/EFL Test #160 "Expressions with death, marriage and divorce", question 3

Our poor old dog is .......... We've had him for fourteen years. He just sleeps all day long.

(a) dead
(b) dying
(c) death
(d) die

English Language Tests, Intermediate level

ESL/EFL Test #160 "Expressions with death, marriage and divorce", answer 3

Our poor old dog is dying. We've had him for fourteen years. He just sleeps all day long.

Correct answer: (b) dying

Your answer was: incorrect
Our poor old dog is dead. We've had him for fourteen years. He just sleeps all day long.
_________________________

Why we must put dying? and dog actually die by something?

Paula

[Conchita]

We know that the dog isn't dead yet, since he sleeps all day long.