The value of business personal property at Ruth's business fluctuates periodically, which is due largely to fluctuations in the value of inventory on hand. Ruth's property insurance policy requires the periodic reporting of business personal property. The limit of insurance is $500,000. Ruth believes she can save money by underreporting the value of inventory. Last period, she reported only $200,000 when the actual value was $400,000. Shortly after filing the last report, the value of the inventory increased to $500,000. The inventory was totally destroyed when a fire occurred. Ignoring any deductible, what is the amount that Ruth's insurer will pay? Explain your answer.