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Dying on Highway! 700

I have a 16 valve 1989 Volvo 740 with 220k. It is having engine troubles pertaining to the fact that it cuts out while driving at 2200 rpms doing 55 mph on the highway. The tach immediately drops to 0 rpms, and sometimes the engine comes back. When the engine doesn't come back I shift into neutral (immediately), and during this process the power steering dies.
I took this problem to my Volvo mechanic and he replaced:
1.) The radio solenoid
2.)Distributor
3.)cleaned the corroding battery
The people I bought it from just had a new(used) mass air flow sensor installed, and my mechanic said that the fuel pump relay is from 1996 (probably doesn't need to be replaced).
What is wrong with my new car? Thanks for the feedback!






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