When using to dye in present continuous which is the proper spelling of this verb

[Nyarey]

English Language Proficiency Tests, Advanced Level

ESL/EFL Test #557 "English Slang Idioms (195)", question 6

"The corporation, by refusing to accept any responsibility for the harm caused to consumers by their products, sounded their own ......... knell. If they choose to move their production overseas, it is still their responsibility to make sure that the products they will sell meet proper quality control standards," Miles told the class during his presentation.

(a) dying
(b) dyeing
(c) death
(d) dearth

English Language Proficiency Tests, Advanced Level

ESL/EFL Test #557 "English Slang Idioms (195)", answer 6

"The corporation, by refusing to accept any responsibility for the harm caused to consumers by their products, sounded their own death knell. If they choose to move their production overseas, it is still their responsibility to make sure that the products they will sell meet proper quality control standards," Miles told the class during his presentation.

Correct answer: (c) death
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When using to dye in present continuous which is the proper spelling of this verb, also, is it frequently used incorrectly and the "e" dropped so that it is spelt the same as to die in pres cont?

is dyeing v. is dying...which is correct and is there a difference in British English v.
American English?

Nyarey

[Mister Micawber]

Dyeing - imparting colour
Dying - ceasing to live

-- in both Englishes.
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Native English teacher at Mister Micawber's